This modification makes the task of adding new overworlds much easier as only the palettes on screen are loaded into VRAM, rather than having set slots.
The reflection palettes have been removed and are handled dynamically by taking the palette of the character to be reflected and tinting it (blue), reducing the amount of graphical work required when adding new characters. It does mean that if you have 5 characters with different palettes being reflected at the same time then that will use 10 palette slots.
Change reflection colour depending on the tile it's being reflected on (water, ice, hall of fame etc).
Can the reflections be made to look like vanilla Emerald?
Probably, the reflection colour is handled by LoadSpecialReflectionPalette() in src/field_effect_helpers.c so you can adapt that function to get the desired effect.