I think it's a myth that this is crack related. I tried all the EXE versions in The Ultimate Collection (TUC) v1.3 and here are the results:
Code: Select all
horse cutscene | correct palette after cutscene | correct palette immediately to level 10
IR Prince.exe: YES | YES | NO
IR PrinceC1.exe: YES | YES | NO
IR PrinceC2.exe: YES | YES | NO
IR PrinceC3.exe: YES | YES | NO
IR PrinceC4.exe: YES | YES | NO
1.0 Prince.exe: YES | YES | NO (asks codes)
1.0 PrinceC1.exe NO | NO | NO
1.0 PrinceC2.exe YES | YES | NO (asks codes)
1.1 Prince.exe: YES | YES | NO (asks codes)
1.1 PrinceC1.exe NO | NO | NO
1.0 PrinceC2.exe doesn't appear to be cracked, because it asks codes.
Immediately starting PoP2 level 10 always corrupts the colors/palette.
The crack messes up the horse cutscene and palette after the cutscene.
[Edit: If the prince starts in another room (not 22 but 11, for example), that appears to fix the problem.]