As I explained over in the proposal thread, this is a utility that lets you mix and match a lot of the information related to sprites. Everyone will get a chance to play around with it during the relaunch of the Tethical kickstarter, but I wanted to show off some of the features that made it into the program. In this post, I discuss using it as a no-nonsense way to replace colors.
--
The Base Image (for reference)This is the standard FFT chocobo sprite (minus the parts I didn't bother to include in the format document, like the portrait).
End Points & Intersections ModeA color replacement method where the program calculates and exposes where color ramps end and where those color ramps intersect. This mode gives the most control (without forcing you to micromanage all the colors).

End Points ModeA color replacement mode where just the end points of color ramps are exposed by the program. This essentially lets the user set dark and light values, and the program figures out the middle values.
Intersections ModeA color replacement mode where only the intersections of color ramps are exposed. This mode lets the user set a minimal number of colors in order to recolor the sprite. It's not suitable for every image, and it relies heavily on perception-corrected hue shifts.

A black chocobo accomplished with 3 reference colors.

--
Understanding the Underlying Color TechnologyWhen the program loads an image, first it removes all the parts that aren't requested by the user. Then it iterates over the image's pixels, storing unique colors. In other words, if the user is only concerned with the arms of a sprite, the program is only going to consider the colors that the arms use (as opposed to, say, the portrait). That's important, because the program can mix and match other sprites (in effect, remixing them). This color-specific example doesn't do that, but hopefully you get the idea.
From Unique Colors to Color RelationshipsStep one is to get all the unique colors in a given part of the image, but just having all the colors in the sub-image isn't enough to simplify anything. Imagine if the program presented you with all 16 unique colors of a sprite. You'd have to set all of them, just as though you were doing it in a graphics editing program. I mean, imagine if the sprite had 160 unique colors or 1600 unique colors. So, to simplify that, the program goes about figuring out how the unique colors are related. Once it's got the colors laid out into color ramps, then we have a lot of interesting information at our disposal. Obviously, it's an easy thought to set out to replace the two colors at the edge of any given color ramp. That's the end points color replacement method.
End Points and the Codominant Pair Color RelationshipIf we consider two colors in a pair, how are they related? In the codominant pair, it treats both ends of the color ramp as significant. In other words, we walk directly from the starting color to the ending color over a perceptual color space, and the program lets you set those two colors separately. Because both of the colors are significant, there's no extra information needed to make color choices.
Intersections and the Major-Minor Pair Color RelationshipWhere intersections are concerned, if one intersection goes to another intersection, the relationship is a codominant relationship (where the colors at each intersection are significant). If the intersection goes towards an end point, the relationship is a major-minor relationship, where the change in hue and lightness are used in tandem to morph the significant color at each step (creating a new color at each point until you have a replacement for all the insignificant colors contained in the ramp). Effectively, you get a perceptually correct hue shift (based on the original colors).
Filling in the Gaps with Minor-Minor Pair Color RelationshipsWhen two insignificant colors wind up next to each other in a color replacement method, they are put into a minor minor pair. It's exactly like the codominant pair relationship, but it happens after all the other more important pairs are set (and its values are set implicitly by other things in the color map).
Putting it all TogetherSo, behind the scenes, the program does a lot of complicated color analysis. However, that's exactly where you want the work to be done. Because it does all that analysis, you can set a couple of colors (check out the charcoal chocobo) and get a pretty good result in the intersections mode (with effectively no knowledge of color). You can also get a very controlled result with the "End Points & Intersections" mode. It requires a bit more knowledge of colors, but you can use the suggested color lightness (in association with the color select dialog) to gauge what might be an acceptable color (re: you can pick a color at random and set the lightness to the right range).