Most images, PNG included, have different modes available.
RGB - any color is allowed
Indexed - only a certain limited subset of colors is allowed (defined as the palette)
Grayscale - only shades of gray allowed
You must have saved it in RGB mode
But be careful because even if you switch back to Indexed, the palette may have changed
I think the difficulty is that armor is so heavy, you're not going to carry around multiple different types and switch them on and off depending on what enemy you're facing, like you might with cloaks/rings.
And unfortunately since every quest has you facing enemies with all different types of weapons, there's not really any advantage to choosing one over the other that I can see...
I'm excited. It's been a long time but I think this release adds a lot of great features and updates, and fejoa's num pad fix will allow me to enjoy playing again