I read that it's due to model collapse - the AIs are now trained on their own AI-generated content, like all the auto generated ghibli-style images with yellow tint

Not necessarily color theory, but archived comics from the 1970s and prior tend to be yellowed from degradation on their original prints (which were then scanned). It could also be the colors available to print artists at the time which were more muted compared to today.

I wonder if it's a white balance thing, as in the setting you'd see on a camera or in a post processing tool.

For instance, consider that "soft" or "warm" light bulbs (say 3000K and below) are common in cozy indoor areas. They cast a much more yellow color of light compared with a daylight bulb or actual daylight, which will look very blue in comparison.

It's like the model detected that the image was people in a living room and it applied a warm white balance to the whole picture because most images of a family in the living room have warm lighting globally.

But since it is a machine and apparently has not yet been explicitly taught that comics generally have bright colors and no strange tints, then it does not adjust accordingly.

I wonder if that is even giving it too much credit. Maybe it's just the deterioration from all the iterations of garbage in, garbage out.

What your world isn't piss coloured? How boring.

There's definitely a sepia tone on most of it. Weird. Why would they go with a red flag so frequently?