I've previously (and am now embarrassed because of this) pronounced this word "ahl-bite" and now realize it is pronounced "ahl-bee-it." Why is it pronounced like this, and not the way I previously pronounced it?
It is a written shortening of all be it, a subjunctive set phrase roughly meaning "even if it is ..."
Albeit is a contraction of all be it, that is, although be it or although it is that. It has no roots in German, where ei would be pronounced with an English long I sound.