Null and I have done exactly 0 building for what Isabelle would have going on in Baby AU, but I personally kinda think Olivia being present would mean that Isabelle is less present in Cy's life, if they still have an affair at all. I don't think Cy and Lynn would especially want to explain to their daughter what the dynamic is there, and as she gets older it would be unavoidable, so probably there would be little to no interaction.

Isabelle would be fine with this, and Cy having a child wouldn't really affect how she feels about him. She's fucked married men who have children before.