Not really sure why people are talking much about the SGB coloring. We have a GBC compatible romhack, it's just the emulator itself seems to overwrite colors 2-4 of palettes 4 and 5 of the BG. I'm guessing it could be fixed by looking into the emulator's code, but it's not worth my time tbh...
Edit: at the very least, I'd still suggest looking into the rom I made for testing this, and modifying it a bit. It shouldn't be too hard to determin when and why the palettes get overwritten
(leaving register $FF68 as 1 seems to partially fix it, that's what I did for the blinking color fix, but most games clear the register, or don't touch it after transfering the colors to the palette, which seems to give the more solid blanked out colors).
Also, I'm guessing it's during V-Blank that it happens, but that's only a guess
I wish I knew how the 3DS worked half as much as I know the Gameboy(Color)