While I'm waiting for some muddied up pink yarn to dry, I thought I'd post a bit about my experiences working with color.
In college the prerequisite for all studio art classes, Art 101, was known among the students as Cut'nPaste. People who considered themselves artists resented having to take it before doing any of the fun stuff, like painting, sculpture, etching, figure drawing. I still come back to the lessons I learned in this most basic class.
One of the exercises involved using newspapers (back in the day, there were no color pictures!) to make a grey scale. Squinting at sections of type, we were to show gradating values from the darkest to the lightest with at least 10 levels.
Another great exercise involved using colored paper (maybe origami paper? seemed like that quality) and doing two different tricks. First, by placing two samples of the same hue on different backgrounds, create the illusion of two different hues. Next (this was harder), take two different hues and by placing them on different backgrounds make them look the same. If you have never tried these two basic exercises and you want to know more about color, give them a whirl.
When Alice S***m***'s (she who must not be named) book on Fair Isle Knitting was released, I bought it and studied it, swatched from it, made tams and sweaters and studied more. That book was my constant companion for many months. Later, Tone Takle and Lise Kolstad, two Norwegian designers released Sweaters and More Sweaters! More Sweaters has a wonderful section on design considerations. If you can get your hands on this book, take a look.
Finally, I cannot strongly enough recommend Color and Fiber by Patricia Lambert et al. I got my hands on my own copy of this book about 5 or 6 years ago. If you want to get technical about why you see what you see, this is the book for you.
Ultimately, though, I learn the most by doing. I understand that warm colors approach and cool colors recede. I understand that placing small clumps of green in a field of red will affect my perception of that green. But ultimately I have to see what happens when those two colors of yarn get together in my knitting. Until that happens, it's all conjecture.