There should be a distinction made here about what the plane "sees" and what the pilot sees.

The plane's performance is governed by dynamic pressure (a function of true airspeed and density, or Mach and static pressure).

However, true airspeed is not the most effective measure of airspeed for a pilot, at least with respect to performance data (the traditional V-speeds). Calibrated airspeed, and at higher Mach and altitudes - equivalent airspeed, are much more convenient measures for aircraft performance because the relationship with dynamic pressure. Unfortunately all instruments have errors inherent to the device itself and its implementation (position error), and the result of these errors is reflected in the indicated airspeed. Luckily for LOW Mach, LOW altitude applications, indicated airspeed is a pretty useful measure, as compressibility is not a major concern (indicated airspeed is not too far off from calibrated or equivalent airspeed). The colored arcs on an airspeed indicator are computed conservatively (heavy airplane for stall and light airplane for V_A and V_NE), and placed on the face of the airspeed indicator in terms of indicated airspeed for pilot reference, and they work quite well.