Check to see if your colour luminance slider is right up at the top.
To the right edge of the colour picker area there is a slider to make the colours lighter or darker. Click somewhere in the middle of that slider to give a mid-range colour.
If you've chosen a different colour picker, you can choose the HS/L picker (shown in the attached image) from the colour picker menu.
If all else fails, you can delete your ArtRage.prs file from the Documents and Settings folder and then start ArtRage. Everything will be reset.
AndyRage's mantra for graphics engine code:
"Sure - how hard can it be?"