I'm only semi-nerd.
ManaByte, what other presets do you use with iPod Legacy?
I just, yesterday, updated to 0.9.3 Handbrake and just use the default presets.
Here are screens of three of the more recent ones I've done (I have ROTK EE pt2 compressing right now):



I've never had any color problems.
The ONLY problem I have is with subtitles when Handbrake crops a non-anamophic DVD. I tried doing the non-SE Star Wars trilogy, but the subtitles won't show up when Handbrake crops the picture. Need to figure that one out.
But like I've said; I've done about 32 rips/compressions using the DVDFab/Handbrake combo.
Edit: Also I am outputting them to .M4V