How would you all set up the sort of scenario where AAF and BluFor are allies, the FIA are insurgent. AAF is an occupation force, but Blufor is there to act as an advisor doing special operations and providing air support?

I was thinking setting up BLUFOR as either Invasion or Asymetric, giving them only one TAOR (an airbase), putting in a hotzone for the FIA and having them occupy that, then having the general AO occupied by the AAF. Would this work, or would it lead to too much conflicting operations between allied sides?

I have in the past had multiple factions share the same air command but when I tried to have AAF and Blufor share an airbase by connecting the AAF's OPCOM to BluFor's Air Commander, I got an error message warning me the Air Commander was connected to an OPCOM that was not side friendly (?)

I have no idea about the ground force aspect but your air component could be solved by putting empty planes and choppers on suitable locations. Those assets are then used by the MACC.

This is the way I use Firewills airplanes who are under NATO faction with CUP units. That way you don't have to declare their faction to the ai commander. This way I have no other NATO assets show up.