One indeed should not mix up Cyprus Airways with Cyprus as political entity, and with a certain airline that used to have a sun in their tail .
(Incidentally that second airline was regulated, checked and technically advised by British citizens , wasn't it ?
)
The general attitude on the Cypriot DGAC , and the political situation regarding their relations with Turkey and the North part of Cyprus part are also totally different issues.
Lastly, seen the size of the population , the " Aviation " family is very small and everyone knows each other personally. Therefore things gets very personal sometimes.