You are understanding correctly, wolfenoctis.Here is a post that explains this in more detail
since most of the images in my restrictions post are still dead. (And... I think they'll stay that way for a bit, sorry. I am trying to finish something else.) I see that you've already found the linked post, wolfenoctis, but I've been asked on slack to clarify more generally.
Specific to Castlevania, the HUD uses the universal color which is always black. This means that without editing the HUD tiles themselves, changing the universal color to something not black will change everything that is black on the HUD to that as well.
What this post really boils down to is, "Do not forget about the HUD when choosing your color palettes." I do not mind anyone changing the colors of the HUD for their levels as Battletoads does
, or even remapping its tiles to allow for something other than black as the universal color. You could even do away with the lighter color if you want (For the bars next to ENEMY), which would get the HUD down to 3 colors, not 4. Just don't make a mockup like it won't be there at all, it's a large part of the game that the original developers had to work around and with. Also remember that there are things in the levels that currently use the same palette as the HUD.