I don't think calling residents Cypriot is a problem, shortening it to CYPS as some ex pats do would be insulting.
Much like calling Canadians - American, although the accent is softer and you guys are not as loud.
I have not been back to Canada for a while, however one of my school teachers came from Vancouver, and during the first Gulf conflict we had the 1st Canadian Field Hospital attached to our Hospital in Jubail, we gave them the nickname of Eager Beavers, as they had T shirts printed with there logo and said animal on the front.
Give me a shout when you arrive if you like.