I don't think cut/bulk cycles should affect blood sugars at all for someone who is carb counting and checking frequently. Weight gain or loss can be looked at in terms of caloric intake as i mentioned before. To gain muscle the most basic requirements are:
1) create a need for your muscles to grow - this would be done by using them, and pushing them.
2) eat a caloric surplus, usually only 200-500 calories above your maintenance is required.
IF someone is already a bit on the soft side, that usually means they are already eating at a surplus (which is how they gained and kept the extra weight) so, that would mean for someone whose 15lbs or more over their ideal weight they would only need to lift weights, while eating the same (provided they get all the required vitamins, nutrients, etc..)
When body builders use term bulk and cut, they always mean bulk = add muscle, and cut = lose fat.
Bulk is very easy lol For the average person it is as simple as going to the gym 3 times a week and lifting heavy, and then simply eating more.
Cutting is the hard part. Without much math, most men can lose fat by simply eating less than 2000cal per day. If your already lean (like <180lbs) then i would go as low as 1800cal per day. So this would mean like eat 2200 cal, and then burn 400cal at the gym = 1800 total at the days end... Or just eat 1800 and skip the gym for a nap, the end result is the same lol
The hardest part in a cut (which usually follows a bulk) is to keep as much muscle as possible, which means cardio, but also lifting heavy (but less frequent, like twice a week).
I prefer the bulk cut cycles because if someone is already relatively lean (like me) its impossible to loose fat and gain muscle. It cannot happen. Because to gain muscle i would need to eat at a surplus of 500cal, but loosing fat is a deficit of 500cal.. so naturally you see i cannot do both at the same time. Its either 2700cal or 1800cal.. whereas eating right in the middle won't accomplish anything other then keeping both my current levels of fat and muscle lol
People who are on the heavy side, or new to working out WILL be able to do both at the same time, but they will eventually hit that wall where they need to make a choice, or waste time trying to do both. This wall comes around 14% BF i have found, which would be right around the time when a dude can start to see ribs, muscle tone, and MAYBE a bit of abs if he works them... Its that point where you think "wow, this is working! i look great" the BAM wall.. and you need to pick lol
But as others have posted, one of the best weight loss meal plans is a ketogenic diet (Low carb, high fat) also happens to be one of the best diets for diabetics. If you plan on hitting the gym, just make sure you also get enough protein (like.. 0.6-0.8g per lb of lean mass... NOT your bodyweight, use your ideal weight, so if your 180 and wanna be 165, eat 165lb x 0.6 = at least 100g of protein each day)
Sorry for the long post, i hope this was informative. My key point is - There should be no down side to working out with diabetes, and its as easy as without it, just keep your sugars normal, check frequently and keep adjusting your basal rates as your weight fluctuates.