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PAL on NTSC TVs results in no color at all. Plus the display will roll due to the difference in refresh rate (50hz vs. 60hz). The output of that unit is definitely NTSC (60hz, 525 lines, color sub carrier at 3.58Mhz) as you are getting a stable color picture. The only PAL format video that was 60Hz with a 3.58Mhz color sub carrier was PAL-M used in Brazil. Viewed on NTSC TVs, it would produce a black and white picture.
If an S-Video cable doesn't resolve the problem, I would start tapping the chroma signal throughout the unit. The first place to check would be at the input pin of the Harris chip. We can likely assume that the problem isn't after the text is overlayed into the video signal as that displays correct and stable color. If the chroma video is correct at the input pin of the Harris chip than the IC is likely bad. If not, its somewhere in the circuit leading up to that chip.
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