Yom Tov Sheini K’hilchaso quotes R’ Shlomo Zalman and R’ Elyashiv as saying that yishuv Yisroel includes non frum.
It is not only about maris ayin and chashad, but that is also a concern (although as I mentioned, maybe not here since its yadua that El Al is Israeli)
The Mishna Berurah does use the term farhesia, but perhaps it’s not the same geder as other uses of the term b’farhesia.
I think there’s a teshuvah from R’ Moshe about it.