ATI Catalyst drivers are really damn badly designed regarding the aspect ratio settings. The latest release have those settings deeply hidden.
First of all - you need to change the resolution of your desktop to such where aspect ratio settings are applied. If you use your native resolutions, those settings are greyed out. You have to change your resolution in such a way, that it's smaller than full screen resolution and is not matching your screen aspect ration.
Then open Catalyst Control Center and click on the home icon (near ATI logo on right top corner of the screen). It will open the panel with the list of displays and desktops. On the bottom there is a list of available displays. Right click on your display and choose configure. From there you may choose scaling options for your screen.
Full Screen will make your games always displaying on full screen, disregarding aspect ratio.
Maintain aspect ratio option (my favorite) will scale SC in such a way, that it fills as much place as possible on your screen, while maintaining aspect ratio (that is older games won't be stretched on wide screen monitors).
Centered is the setting you most likely have currently selected.
Regarding color fix - you may try launching SC with explorer.exe process being killed before starting game. It works, but it's not perfect solution. Killing system process such as explorer.exe might have negative effect on your system and is not suggested.
You may try color fix posted by Warlord_7, which involves importing registry entries. All it does is updating the compatibility list in such a way it recognizes the latest version of Starcraft. By default Windows 7 recognizes the non-patched version of starcraft. So all the registry fix does is adding SC v1.16 to compatibility list.
You may find the thread about this fix here: http://forums.battle.net/thread.html?topicId=23214533181&sid=3000