Hearty, don't think it's about being based in England, Loganair are Scottish and still get a fair amount of critisism, some of it justified, some not.
I would guess most of the concern comes from Flybe's track record of base and route instability usually linked to its financial performance.
If it has the cash to throw at developing thin PSO routes, ( the busier routes are already self sustaining) great, but how many of them would survive the accountants scrutiny the next time costs need to be cut and 78 seats need to be filled is a worry. Especially if the only alternative is 12+ hours on a ferry in a force 8 gale!