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Wonderful little game. Would enjoy this being extended even :) 

If you don't mind sharing, how did you create the coloring effect? Is it a custom shader?

Yes, a fairly simple custom shader. A full-screen ColorRect on a CanvasLayer above the background draws both the gray and the colored areas. An autoload script keeps a low-res mask of the whole world that records what's been colored (by the wand, the stone lanterns, restored areas), uploads it as a texture every frame, and the shader samples it at each pixel's world position.