So, I'll pretend it's hardware right now

I got an A1200 some months back from a friend of mine (for free!

), it has a '030 upgrade in the trapdoor with 8MB of RAM on it. I put in a new drive, installed Workbench 3.0 (I think), got it all up and going. I installed Miami to connect to the net via dialup, installed MagicWB, and MUI. I use Degrader, and Tude to boot into older games...
Everything was going fine and then...
The weirdest thing happens. When I initially bootup, it only boots up with a 16 color palette. If I go into the screen settings, I only have the option of switching to 16 colors max on my AGA machine.
Now it gets weirder...
If I go into the boot options (ie, hold both mouse buttons down), and then immediately exit without doing ANYTHING, it comes up in 256 colors. If I warm boot or cold boot after that it drops back to 16 until I do the above process again. Is it possible that there is some software doing this or am I missing something obvious?!
Any enlightenment would be great...
Brian