The standard NTSC Apple II does not generate color this way, but the European PAL models do.
The native Apple II video signal is 560x192 1-bit monochrome pixels. The PAL video circuit converts video signal into a digital stream of color pixels, 4 bits per pixel. It then converts the digital pixels into analog YPbPr signals by attaching various resistors to each of the 4 bits. The YPbPr signals are then fed into a PAL encoder chip.
Presumably, the original authors used these YPbPr resistor values to determine the colors sent to their Bulgarian PAL/SECAM encoder.
This is a schematic of the PAL color encoder for the Apple IIe: https://imgur.com/CQH7vNS
1. The native monochrome video signal is SEROUT in the top-left of the schematic. It is fed into the LS164 shift register.
2. The LS175 buffer captures each 4-bit color pixel from the shift register.
3. The output of the LS175 is then fed through a various resistors to generate the YPbPr signal which are fed into the TCA650 PAL encoder.