Created repository.

- 256 variants of a single item "256_dyes:dye". Not useful for now.
 - Universal mixing craft recipe: you can mix up to 9 colors at once on the crafting grid.
 - In game, only the brown dye can be found in creative inventory. You can change the color by clicking:
   - Right click changes hue
   - Left click changes brightness
 - The `color.dat` file is used by the mixing algorithm. (compressed list of RGB color codes)
 - gen_palette.py: Python 3 script to run with Python Image Library to generate the palette and color.dat. Could be easily modified to generate a different palette.

gen_palette.py

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+from PIL import Image
+from array import array
+from zlib import compress
+
+#palette = Image.new("RGB", (16, 16))
+
+palette_list = []
+
+modifiers = [
+	(0.25, 0.00),
+	(0.50, 0.00),
+	(0.75, 0.00),
+	(1.00, 0.00),
+	(0.75, 0.25),
+	(0.50, 0.50),
+	(0.25, 0.75),
+	(0.25, 0.50),
+	(0.25, 0.25),
+	(0.50, 0.25),
+]
+
+def add_color(color):
+	global palette_list
+	palette_list += list(color)
+
+def variations(color):
+	for mod in modifiers:
+		sat = mod[0]
+		off = mod[1]
+		r = int((color[0] * sat + off) * 255 + 0.5)
+		g = int((color[1] * sat + off) * 255 + 0.5)
+		b = int((color[2] * sat + off) * 255 + 0.5)
+		add_color((r, g, b))
+
+hues = [
+	(1.00, 0.00, 0.00),
+	(1.00, 0.25, 0.00),
+	(1.00, 0.50, 0.00),
+	(1.00, 0.75, 0.00),
+	(1.00, 1.00, 0.00),
+	(0.75, 1.00, 0.00),
+	(0.50, 1.00, 0.00),
+	(0.25, 1.00, 0.00),
+	(0.00, 1.00, 0.00),
+	(0.00, 1.00, 0.25),
+	(0.00, 1.00, 0.50),
+	(0.00, 1.00, 0.75),
+	(0.00, 1.00, 1.00),
+	(0.00, 0.75, 1.00),
+	(0.00, 0.50, 1.00),
+	(0.00, 0.25, 1.00),
+	(0.00, 0.00, 1.00),
+	(0.25, 0.00, 1.00),
+	(0.50, 0.00, 1.00),
+	(0.75, 0.00, 1.00),
+	(1.00, 0.00, 1.00),
+	(1.00, 0.00, 0.75),
+	(1.00, 0.00, 0.50),
+	(1.00, 0.00, 0.25),
+]
+
+for hue in hues:
+	variations(hue)
+
+for i in range(16):
+	l = i * 17
+	add_color((l, l, l))
+
+palette_buffer = bytes(palette_list)
+
+palette = Image.frombuffer("RGB", (16, 16), palette_buffer)
+palette = palette.transpose(Image.FLIP_TOP_BOTTOM)
+palette.save("palette.png")
+
+color_list = open("colors.dat", "wb")
+color_list.write(compress(palette_buffer))
+color_list.close()

init.lua

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+local modpath = minetest.get_modpath(minetest.get_current_modname())
+
+local function change_variation(itemstack)
+	local meta = itemstack:get_meta()
+	local color = meta:get_int("palette_index")
+	local variation
+	local new_color
+	if color >= 240 then
+		if color == 255 then
+			new_color = 240
+		else
+			new_color = color + 1
+		end
+	else
+		variation = color % 10
+		local hue = color - variation
+		new_color = (variation+1) % 10 + hue
+	end
+	meta:set_int("palette_index", new_color)
+	return itemstack
+end
+
+local function change_hue(itemstack)
+	local meta = itemstack:get_meta()
+	local color = meta:get_int("palette_index")
+	local new_color = color + 10
+	if color >= 230 then
+		if color == 255 then
+			new_color = 0
+		else
+			new_color = math.max(color + 1, 240)
+		end
+	end
+	meta:set_int("palette_index", new_color)
+	return itemstack
+end
+
+minetest.register_craftitem("256_dyes:dye", {
+	description = "Dye",
+	groups = {},
+	inventory_image = "256_dyes_dye.png",
+	wield_image = "256_dyes_dye.png",
+	palette = "256_dyes_palette_2.png",
+	stack_max = 99,
+	color = "#400000",
+	on_use = change_variation,
+	on_place = change_hue,
+	on_secondary_use = change_hue,
+})
+
+local file = io.open(modpath .. "/colors.dat", "r")
+local raw_colors = minetest.decompress(file:read("*all"))
+file:close()
+
+local colors = {}
+for i=0, 255 do
+	local pos = i * 3
+	raw_color = raw_colors:sub(pos+1, pos+3)
+	color = {raw_color:byte(1, 3)}
+	colors[i] = color
+end
+
+local function mix(...)
+	local list = {...}
+	local n = #list
+	local sum_c = 0
+	local sum_m = 0
+	local sum_y = 0
+	for _, i in ipairs(list) do
+		r, g, b = unpack(colors[i])
+		local c, m, y = 255-r, 255-g, 255-b
+		sum_c = sum_c + c^2
+		sum_m = sum_m + m^2
+		sum_y = sum_y + y^2
+	end
+	local true_color = {math.sqrt(sum_c/n), math.sqrt(sum_m/n), math.sqrt(sum_y/n)} -- I found that calculating the quadratic mean of CMY colors gives more realistic mixes because it makes the mix more sensitive to dark colors
+
+	local min_diff = 765
+	local nearest = 0
+
+	for i=0, 255 do
+		local color = colors[i]
+		local c, m, y = 255-color[1], 255-color[2], 255-color[3]
+		local diff = math.abs(c - true_color[1]) + math.abs(m - true_color[2]) + math.abs(y - true_color[3])
+		if diff < min_diff then
+			min_diff = diff
+			nearest = i
+		end
+	end
+	return nearest
+end
+
+for i=1, 9 do
+	recipe = {}
+	for j=1, i do
+		table.insert(recipe, "256_dyes:dye")
+	end
+
+	minetest.register_craft({
+		type = "shapeless",
+		output = "256_dyes:dye",
+		recipe = recipe,
+	})
+end
+
+local function dye_craft(itemstack, player, old_craft_grid, craft_inv)
+	if itemstack:get_name() ~= "256_dyes:dye" then
+		return
+	end
+	local list_colors = {}
+	for _, stack in ipairs(old_craft_grid) do
+		if not stack:is_empty() then
+			if stack:get_name() == "256_dyes:dye" then
+				local meta = stack:get_meta()
+				table.insert(list_colors, meta:get_int("palette_index"))
+			else
+				return
+			end
+		end
+	end
+	if #list_colors == 0 then
+		return
+	end
+	itemstack = ItemStack("256_dyes:dye " .. #list_colors)
+	local new_color = mix(unpack(list_colors))
+	local meta = itemstack:get_meta()
+	meta:set_int("palette_index", new_color)
+	return itemstack
+end
+
+minetest.register_craft_predict(dye_craft)
+minetest.register_on_craft(dye_craft)

mod.conf

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+name = 256_dyes