The different bubble colors were just to have the game more colorful.
The red dot is your health (normally 3, that's why at the right of the clock). The orange dots on the bubbles are the analogue health counters on the bubbles.
The blue dot is the level you're on, so you need a full rotation of it to get all items.
Yeah, it basically is like an endless mode. I felt like the objective is to get all 12 upgrades, but nothing in the game really tells you that, except subtly for the item selection not opening after that.
I'm glad you liked the concept. :)