What is the correct term to use, Shaivism or Shivaism? I could not find a good source about how the word Shaiva (Saiva, Caiva) appeared and when.
From Wikipedia of Shaivism,
Shaivism ([Śaivam]) (Devanagari: शैव संप्रदाय) (Tamil: சைவம்) is one of the major traditions within Hinduism that reveres Shiva as the Supreme Being or its metaphysical concept of Brahman. The followers of Shaivism are called "Shaivites" or "Saivites"
Devotees of Shiva are Shaiva
Devotees of Vishnu are Vaishnava
Hence Shaiva is the correct pronunciation.
Saiva, Siva are Sanskrit and "ism" is English. So they are both hybrid words. Both Saivism and Sivaism mean the same thing but Sivaism is a bit unusual. They are analogous to Marxianism and Marxism.
It took some digging to get it answered:
Śaivism is formed from śaiva as Brāhmanism is from brāhmaṇa. Grammatical explanation of what is a Śaiva according to Aparāditya’s Yājñavalkyasmŗți-tīkā: Śaiva is one who studies or who knows the śaivam, which is in turn defined as the scriptural system propounded by Śiva (śivaproktaṃ śāstram). Formation: The use of the aṆ suffix (i.e., taddhita formation) can mean “taught by him” (tena proktam), giving us the word śaivam. Then, I can understand that śaivam ≠ śaivism.