Accounting for categorical variable in only a few observations OK, I feel stupid asking this, but I am positive you all will know exactly what I should do here.  
I have a simple regression situations (small sample sizes; n=13-18), and a few observations that are different with respect to a suite of characteristics that can be generalized by a single dummy variable (ex. south site vs. north site).  If I had a roughly even number of sites in each category (north or south) with a decent spread over the X value, I would consider ANCOVA (I guess), but I do not.  I have ~3 (of 13-18) sites that belong to "south" that if removed would lead to a nice linear relationship among the "north" sites.  What would be the most appropriate method for dealing with these data.  It seems like there has to be a better way than running the models with and without these sites and then doing some hand waving. 
Please let me know if you have any good ideas. 
 A: (Too long for a comment, so I've made it an answer)
I'd still use something similar to ANCOVA.  
The first thing to try would put in a dummy for the south group (say - it doesn't really matter which), and an interaction between the dummy and the independent variable. Unless you're pretty confident a priori it's just a difference in intercept (in which case I'd probably just go with main effects - the usual ANCOVA-type assumption - which would amount to a different intercept for the two groups). 
This use of dummy and dummy*IV interaction is the way to estimate different relationships for the two groups whether or not it's valid to call it ANCOVA. (Personally I think too much of a fuss is made about ANCOVA - the whole thing is just part of the linear model.)
You can do other things if you make different assumptions. 
I don't see how running the models with and without the sites could do better (it only makes your life harder when you try to do inference), unless you also think the variance is different. 
(Why do you say the number of observations at the two sites must be similar to do ANCOVA?)
