But sometimes we would see unimaginative stuff like a specification of the LED layout on the front panel or very specific weight restrictions that happened to fall between our hardware and the preferred vendor.
In the government's defense, though, the system is set up to combat this tendency, at least for smaller contracts. When I was on the other side (having left the vendor to work for our civil service customer) we would routinely get pointed questions from the purchasing people regarding this or that line of the RFP - was it really required, or were we trying to wire the contract?
and my understanding that this supply is limited to the what had already been manufactured long time ago. Beside the inventory issues, one can easy imagine Putin saying "bad Americans, no more gas ... err... rocket engines for you"
NK-33 - from which AJ-26 are made - aren't manufactured today. It's a question if the manufacturing will restart. There are a few tens of them in US. Orbital Sciences has that question in the middle of their table, or close to it.
Russian-American relationships in space trace back to at least 1975, deep Cold War. We're not at that state of affairs just yet. As somebody mentioned on The Space Review, ISS is a front-runner for Nobel peace prize, so let's not jump the gun too early. It doesn't seem to be too desirable for Putin to close that particular relationship.
In response to your edits:
>but they can't get more flights because of their record
The Air Force required 3 successful flights in the exact configuration the Air Force would fly. SpaceX provided the "record" as stipulated by the Air Force, which nevertheless committed to a large block-buy contract with ULA. By the Air Force's own standards, the billion-dollar subsidy is not necessary for their needs-to-get-to-space payloads.
Also, "the other companies" is just a single supplier, ULA.