Artifacting, but first, this game performs so poorly it wasn't crafted in machine language, it's compiled Basic or worse, why did Sierra On-line get involved? Instructions say you're getting "Four Hi-Res" games but only two (on the left) and the title/menu are high resolution, the two right-hand-side games draw using low res.
Artifact testing in LWL is good because the paint program tries offering about 9 different "colors" thru various patterns which rely upon the "old style" artifact emulation exaggerating the look of CRT, "new style" 2 color artifacting, which is generally a good idea, looks terrible here on LWL paint program. The intended color scheme is likely Blue and Brown but hard to tell when it's reversed, because the title screen and the menu screen already reverse themselves, giving "Leeper" the two different patterns to start with. LWL I think wreaks havoc on my emulator and reverses or mangles the artifacting, by itself sometimes. Whether you're in reverse or not seems to depend on whether you think the dogs should have Blue eyes or Brown/reddish eyes. I'm tending toward dogs with Blue eyes.