I think the quality of Colors, and Generations as well, has been greatly exaggerated. They're not awful games by any means, but the Sonic franchise has lowered the bar so much that merely decent games seem like revelations in comparison to what's come before them. It's not hard to look good when you're standing next to Sonic 06.
The amount of bad Sonic games (okay, to be nice, I'll stick with just the 3D titles) outweighs the good ones. Colors and Generations might have been positive steps, but it's going to take a lot more than that to make up for the many failures.