No that's definitely intentional. If I'm remembering my reasoning correctly, it's because 1) the Ottomans would often spawn facing a massively, ahistorically powerful and unified Byzantine empire that would royally kick their asses, and 2) AI Karaman would almost never spawn organically so I made central Anatolia flip to Independents so it would reliably flip to Karaman after. Honestly, I probably nerfed AI Byzantium a bit too much. These flips were totally survivable as player Byzantium last I played, but that's certainly in part because I of course knew about them, and to be fair I haven't played as the Byzantines in a while.