@zach
The color and gobo wheels are separate so you can stack any color over any gobo. I hope that answers your first question. I'm not sure I completely understand the effect you're going for.
As far as the differences between the 160 and 260, the 160 is lighter and smaller so it is easier to move around. But the output looks about like a 100 watt standard bulb(maybe 120 being generous) . That's pretty dim for most uses. I went with the 260 because it is much easier to dim a fixture than be stuck with one that won't get any brighter. The guts are pretty similar between to two but the extra wattage is worth the cash, unless you just want to light your basement. In short if your budget can handle it, buy the 260.
Hope that helps.
Cameron