Very interesting idea.
I've edited your post to put a spoiler warning just in case there's anyone who hasn't seen, and wants to see season 6 and 7. Probably wasn't nesicarry of me, but better to be safe than sorry
I think that Willow would be in Ravenclaw or Gryphindor. Willow is pretty brave when she needs to be, but I'd put her into Ravenclaw because one of the things that defines her personality is how smart she is. Kinda like Hermione, but different. I think Willow would belong in Ravenclaw more than she would in Gryphindor, I think that Willow "learnt" her bravery from Buffy, but her cleverness is just part of who she is.
I was thinking Slytherin because
of her tendency to play around with magic with unfortunate
results, plus the last few eps of Season 6
This is where crossovers get very tricky. The magic in the Buffyverse is very different to the magic in the Potterverse.
In the Potterverse, magic just seems to be a part of nature and certain individuals are just born with the power to weild it. In the Potterverse, people choose whether or not to use the magic for good or evil, the magic itself doesn't make someone bad.
In the Buffyverse, magic seems to be attributed to certain gods, demons and spirits. In the Buffyverse, (just like HP) most of the population doesn't use magic. However it seems like ordinary people can learn to cast spells of limited power if they take the time to learn (Wesley, Giles, Ms. Callender, Anya). Witches and Warlocks in the Buffyverse are just born with a higher level of potential for magic.
As for Willow doing those evil things in season 6, the dark magic she absorbed was corrupting her. Unlike HP where a person is (almost) always in control of thier magic, in Buffy the magic itself can originate from an evil diety and corrupt an otherwise good person from the inside.
I think that Tara would be in Hufflepuff
And Darkwillow would be able to whoop Voldermort anyday of the week.