Update:
As of late 2025, Bitsy Color seems to have a bug. The DRWI and DRWS codes, which are supposed to display items and sprites respectively, no longer work in Bitsy Color, and instead there is just a blank black space in the dialog. Only DRWT works. This means it now only draws “tiles”, not sprites or items, and it also only draws “tile color” in tiles.
That means you need to create a tile version of the item / sprite you want to show in the dialog, and you must recolor it entirely to “tile color”. You can pair this with the CLR tag as before, to color it anything in your palette. The RBW (rainbow text) and SHK (shaking text) also work, and you can even pair them together, to display a rainbow shaking item in your dialog box:

Without adding a CLR code, tiles will only be drawn in black and white regardless of the original color. Notice how the "block" is blue onscreen but appears as black and white in the dialog:
