Klint: I have a problem that looks similar to the "rainbow wrong palette" problem, but isn't exactly the same. The palettes are mostly correct, but paler. All the colors are blue-er, more bright, the space is in fact more like blue navy instead of black. My brightness is set to 0 in-game. If I try to alt-tab I can see the true, correct colors, but they'll revert to the wrong, pale palette once the game regain focus (so I can't take a screenshot of the wrong colors, only of the correct ones).
There is something interesting to mention. This evening I left the game running while I was afk, and when I came back the screensaver was active. So I moved the mouse, and SURPRISE, the correct palette was loaded, and remained like that until I closed the game.
Any help here? Seems like it must have a pretty easy answer.

scotsdezmond: What you are describing sounds like a gamma issue. I used to get this sometimes with some games (like Star Trek Bridge Commander - also by Totally Games) that would load up their own gamma settings when they went to fullscreen mode - if they crashed, it often wouldn't reset and so the desktop would be the wrong colours too, until I restarted the game (or tried another that changed the gamma setting).

I haven't seen this issue for many years though, and I'm not certain how you would solve it in this case - you might be able to try setting/forcing a gamma setting on the graphics driver control panel.