When the Lord made Jun Wu Xie part of the mission, Chi Yan immediately got Qin Qi to find out about Jun Wu Xie's past. Although much had been said about her, being in the exalted position that she was in, Chi Yan never bothered listening to stories about a young person fresh out of Sea Spirit City.
After knowing that Jun Wu Xie was to become a Knight of Destruction, Chi Yan thought that she would go through a cleansing, erasing her past. Once that was complete, she would become as loyal as a dog, no matter what kind of person she once was.
But the Lord's sudden decision surprised Chi Yan and turned what he knew upside down.
Chi Yan did not have the ambitions of Long Yao, but he would not allow anyone who might threaten His Lord's success.
Chi Yan was clear as to what Long Yao's ambitions were but Long Yao was no match for even Chi Yan, much less His Lord! So Chi Yan just let him be.