Skittles is a little different but still seems like a similar behaviour. Instead of hissing, she bites her foot and screams really loud like someone just bit her... : D
She does this when anyone other then me gets close to her. When I hold her, for most part she behaves very we'll. She does get nippy sometimes and I tell her "no bite" and set her down or put her in her cage. She does seem to get the message and has never bitten me hard yet...
What is interesting is how she acts when I take her outdoor in the public. She let's other people pet her. Doesn't bite herself. Says hi and hello. She acts better for strangers than she does for my family. I really need help with that.
As far as the hissing, I find that if I turn my back at bad behavior or ignore bad stuff, that works well. Biting crosses the line for me and I will say "ouch" or "no bite". If it actually hurts, I say that and do a time out. Skittles hasn't drawn blood yet, but today she did really give my thumb a squeeze. She quickly released my thumb and I was so startled that I wasn't sure if she was trying to bite me or hold on to me for balance. Six months into parrots, and I still can be afraid of their beaks...