Reb Gershon, your question appears in the Mesivta edition of the Gemara in the name of the Avodah Berurah.

1) The Avodah Berurah's answer is based on the dispute above (12b-13a) between Rebbi Shimon ben Lakish (Reish Lakish) and Rebbi Yochanan. Reish Lakish maintains that one is not allowed to obtain benefit from Avodah Zarah but one is allowed to grant benefit to Avodah Zarah. Rebbi Yochanan disagrees and maintains that one is even not allowed to give benefit to Avodah Zarah.

2) Therefore, each Amora thought that the other Amora was relying on the opinion of Reish Lakish. According to Reish Lakish, one is allowed to buy sandals and bread from an idol-worshiping businessman, even though this will cause the businessman to pay tax to Avodah Zarah, since Reish Lakish maintains that one is allowed to give benefit to Avodah Zarah.

3) The Mitzvah to judge one's friend favorably applies only if one thinks that the friend transgressed a Mitzvah. If one thought that the friend was relying on a certain opinion in Halachah, there is no obligation to Dan l'Kaf Zechus, because one does not believe that a prohibtion was transgressed.

4) However, each Amora called the other an orphan because it appears from the continuation of the Gemara that both Rebbi Yakov and Rebbi Yirmeyah were considered students of Rebbi Yochanan, so one would have expected them to conduct themselves in accordance with Rebbi Yochanan's opinion. If somebody does not follow the opinion of his rebbi, he is considered an orphan because Talmidim are considered sons of their teachers.

5) Rashi (DH Yasma) writes that an orphan is lacking Da'as. He is not doing an Aveirah, because he has the opinion of Reish Lakish to rely upon, but on the other hand he is not behaving in the most intelligent way since a Talmid should stick to his teacher's opinion.

Kol Tuv,

Dovid Bloom