I’ve so far only completed a few runs. I use the NPE Runn.
I have set the inclination to either what it says in the upper right corner that the course is. Our to what it says the workout should use.
In the first case, when just running, the color of the text for the inclination shift color. Although the inclination it self (the number) is constant. What does the color signify?
Does it take the inclination reading from the NPE and compare it to what it “should be”?
I really miss a user manual. 
I do not think that the inclination is derived from the NPE pod. As far as I know no pod is able to produce such data. Regarding the colour change and the missing manual you have definitely got a point here.
However, don’t forget that the inclination should be 1-2% anyway to simulate a flat outdoor surface because you have no wind resistance inside. So if Zwift shows an inclination of 2%, I think you should add this, leaving you with 3-4% in the end.
Apart from that, I would find more eye-catching inclination changing indications helpful to adjust the treadmill.
The NPE Runn does indeed produce inclination data, together with speed and cadence. It is quite precise, and sensitive. If I turn it on it’s head, it says 180 degrees… 
I can read the data with an accompanying app. You can also calibrate it to your mill. I find the inclination more off than speed on my unit.
Mind you, I’m not saying the inclination stated at the upper right corner derives from the NPE. I think that is the current inclination that the course has. But what I am wondering about, is the color change. Why does the color change when the number doesn’t? And here is where I’m suspecting and would like a confirmation - that when the inclination reported from the NPE doesn’t match the course, the color indicates that it is off, and possibly also with different colors, if it is way off or just slightly off.
But, I can’t find anywhere where it explicitly says and describes what these indications actually are. So I was hoping a Zwift official could comment. Or point me to a user guide…
I think the colour darkens as the gradient increases. White for not too bad, yellow for fairly hard and red for very hard.
The colour does change on the same number, think it’s either 5 or 6%.
I’ve always thought this was to signify if the gradient was say 5-5.5% yellow or 5.6-5.9% red.
And to clarify zwift does absolutely nothing with incline data from the Runn. It doesn’t read it. Other apps do but zwift doesn’t so the percentage figure it’s purely the gradient of the course.
It’s why I can run up Alpe Du Zwift quicker than I can cycle up it. Gradients don’t slow the avatar down