Anthony Taylor is from Manchester, but is regularly given matches involving both Manchester sides. Is this a problem, can we really have grievances and even suspect him of negative actions against City for unproven claims that he has sympathies with our main rivals? Well, going by the FA's own position on such situations, hell yes.
Speaking to someone who used to referee in similar circles to him many moons ago, I am assured that whilst he himself may or may not be a United fan, many of his relatives and multiple generations of his family are. This undoubtedly has an influence privately on him, whether he lets it show and manifest itself in his profession is the bit that has to be proven. I can appreciate from the FA's point of view it all gets rather sticky here - United are a vastly supported club so to have a referee with no connections at all to Untied, or to any PL club, is nigh on impossible. But the FA also have a duty to protect their referee's from sticky situations, and putting him in the firing line repeatedly is a confusing message.
Take Kevin Friend, he was removed from a Spurs match later on in the season as he is a Leicester resident and they were the main contenders for the title last season. No match is ever worth more than three points, so removing a ref from a game in the final part of the season as with Friend should not be a factor, it should apply for any game.
It is likely more difficult with Manchester as you have potentially more teams involved, with Manchester having two PL clubs, and so the scope in terms of team directly affected is greater (City, United and our two direct opponents that week, plus those teams around us both) . But not impossible to navigate, if the FA wanted to.
I genuinely don't however think this would be an for us issue despite all of the above if there was not history of Taylor having very questionable behaviors in games where he has reffed us. And by that I mean, every ref comes under fire, every ref gets things wrong, and every ref is to a degree unpopular with each set of fans in each game, and fans remember. But in Taylor's case there are multiple incidents in multiple games which bring either his ability, or his bias, into sufficient question as to make putting him in such a position a very odd decision from the FA. It doesn't protect him from abuse or criticism pre or post game, and it doesn't follow the previous behavior and guidelines shown by the FA.
And finally, for a FA Cup game, essentially a knock out, a grand final in its own right, once the precedent was set with Friend then Taylor should never be near an FA Cup tie directly involving a Manchester club.