Ponder these 3 pieces of evidence:

1. Where are all the other fairies? Whenever we meet a "non-background" fairy, they seem to get written out or de-powered: Tink, Tiger Lily, Nova/Astrid (who I keep hoping will return to Grumpy/Dreamy).
2. Why doesn't she help out more? She has great power, but seems oddly reticent to help out unless it suits the plot her agenda.
3. The most obvious cue is her costume. In OUAT cleavage is a clear signifier of evil. Compare Ingrid/The Snow Queen, Fiona/The Black Fairy, Zelena/The Wicked Witch and (of course) Regina/The Evil Queen - yep, it couldn't be more clear: The Blue Fairy is the secret mastermind behind all Storybrooke's troubles.