Kyndi the Badass Space ChickThe issue with colored dialogue text is that it comes off as an amateurish crutch.
The issue of colored text is related to the medium we're publishing in. The web has developed a set of rules that is different from the rules we apply to paper. People are used to seeing colored hyperlinks within text. Text on Inara is not black on white, but white on grey, with added drop shadows. Although I don't use colored text myself, I'm not entirely opposed to it if it matches the theme of the website. For example, orange and blue work well here because they match the site and the UI design of the game. So if you absolutely have to use colors for some reason, I'd recommend these two.
I've tried to format my own story according to paper rules, but it's difficult to do this on the web. For example, paper uses indentation to mark paragraphs, and blank lines to mark sections. By default, the web does not support indentation in plain text. Leading white space submitted through forms gets stripped. If you use block paragraphs for dialog, you'll end up with a lot of one-liners separated by blank lines, which looks horrible. The alternative is indentation via characters, but the problem with those is that you can't enter them with Android's default keyboard app. There are workarounds, but you can see where this is going. Colored text provides an easy way out of this problem.