Gerd, If they copied the Packard radio which was built by Philco, a bulb covered by a metal hood with a slot like window is behind the wheel with the opening facing outward so a narrow beam of light shines thru the wheel. Very close to and on the other side of the wheel is the dial plastic. A pickup which is part of probably Lucite plastic that has the dial numbers embossed on contains the pickup portion which sits closely in front of the wheel. As the wheel turns it moves to a different color and the color is transmitted thru the plastic pickup and changes the dial colors.
In the bare dial photos, I did not show the additional felt and metal pieces which keep the light closely confined to the plastic so it does not shine thru the PB openings but those are shown in the last two photos. Don't remember what the purple celluloid filter does at the moment.
The color is part of the tone control. Been a long time and my memory could be out to lunch but as I recall, more bass is supposed to be warmer so dial is red and as tone control moves toward more treble it changes to amber then blue.
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