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Overworld Event Glitch?

Quick question, when I activate an overworld event for the first time, the color palettes of everything sorta freak out and go black eventually. They fix themselves if I enter and exit a level again. Only thing I can think of off the top of my head is the fact that this is my first time using an HDMA gradient in the overworld. Any thoughts?
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Sounds like you're using Palettes 0-3 on your overworld. Those palettes are used for the path fade effect and shouldn't be used unless you disable the effect. You can disable it by going to Overworld > Extra Options and then check "Disable event path fade effect".
Just need to ask this...

Are you loading in with a save state or are you opening the rom and going through the intro first?

I ask because i have seen issues similar to what you describe when loading in with a save state that was made prior to doing the events.