If it's Cypress from a Red Pond Cypress Tree, then it's fine. I have never seen dyed cypress mulch, but if it is dyed I would stay away.

As far as the little wood mites and flies that come with cypress mulch... they really are harmless and more of a nuisance to you.

Another alternative is Mulch Block... made from Coconut Husk. You can buy it at your local Ace Hardware store. It's totally organic and works great. I only caution not add too much water when you first set up the mulch.

Hope this helps.

Oz