I think you have it exactly right. The government's language repression story is well known. Less well known is the local dialect affect. Iñupiaq spoken in Barrow is not perceived as "correct" in Noatak or Unalakleet, and elders enforced local dialects, doubly discouaraging young speakers. Similar phenomenon exist in other languages. New Yorkers sneer at Alabama dialects, but the consequences are not so profound for English.