Haven't had time to respond here sooner as I've been busy with my projects, but a HUGE thanx to Spaced Ranger for explaining the process. The paint program looks very familiar to me (PSP, I believe) and those settings worked nicely when I tried to "test" your method.
I own both, the Colorized DVD and the new (very nicely transferred) B&W Bluray. Unfortunately, my DVD is cracked, but I do still have a DVDrip (at 1.8GB) of it backed up on my HDD. EDIT: just found an iso of the DVD on one of my backup HDDs:)
If you want, I can either post some usable screenshots from both and/or results using the technique you described;)
This is interesting stuff and I'm wondering how this can be done easily using something like Sony Vegas. (reason I mention that is because I like to be able to have a real-time preview of the effects of the plugins as you make adjustments) I will see if I can follow your guide but, instead, using the various plugins in the app. If someone knows an easy way to do this and can save me time, I welcome that BUT I intend on figuring it out regardless and if I see no post concerning the matter, am happy to share my process for others to use:)