I hate to be unable to put my money where my mouth is, but I read a bunch of early 3d game GDDs in college as part of understanding and overcoming hardware limitations in computer graphics. It wasn't so much "dont do this" as justifications such as "we did this because many tvs dont have stereo sound" or "using colors of the same hue is unviewable on black and white TVs and our portable systems"

Here's some examples of dithering being used in order to do effects like gradients and pseudo-transparency:

http://retro-sanctuary.com/comparisons%20-%20differing.html