So I tried to alter the image of a fighter I have, because I am trying to fit them into the same style as the other fighters.
The icon I'm referring to is the select screen/life bar. I can get the icon to be colored correctly on the select page, no issues at all, but in game, the icon gets completely mis-colored and basically corrupted.

I tried to fix this before by:
Taking the image, importing it and then importing the color pallet through image, this didn't work. However, when importing the image or color pallet, I got several error messages at different points, either after importing or when saving the project.

I loaded the image into GIMP 2.8 and changed the image mode to indexed, imported the image onto the sprite again (with no error message). Same result in the actual game as before.

I'm using MUGEN 1.1 and Fighter Factory Studio.