This problem is a bug in Blender itself. But instead of fixing it I looked at having it working with Multi-Textures instead of Single-Textures (since Single-Textures is no longer supported in Blender).
While doing this I ran into a bug "Bitmap Text Object color issue with MultiTexture": https://developer.blender.org/T42539 - I went as far as pinpointing the exactly commit that produced that bug.
I'll see if Campbell replies, otherwise I will look at it myself. Again, this is not super critical, but it's important to identify which issues we ran into while dealing with those old files.
This problem is a bug in Blender itself. But instead of fixing it I looked at having it working with Multi-Textures instead of Single-Textures (since Single-Textures is no longer supported in Blender).
While doing this I ran into a bug "Bitmap Text Object color issue with MultiTexture": https://developer.blender.org/T42539 - I went as far as pinpointing the exactly commit that produced that bug.
I'll see if Campbell replies, otherwise I will look at it myself. Again, this is not super critical, but it's important to identify which issues we ran into while dealing with those old files.