Just tested this with swapping the first layer also. As soon as the sprite is loaded in, a blue hue is applied to it. This isnt the palette function or anything either!
Just realized the issue. I had saved previous sprites as a gif! when you load a gif sprite into it it adds a blue hue color to it. Just tested it there with both a png and a gif with multiple sprites and all the gif sprites (even if they're single frame) turn blue when loaded in!
