Strangely enough I can't reproduce it either... maybe some bizarre interaction with my lib fire event is causing the color to not show...
Anyway, not a big deal.
[EDIT]
Confirmed, it's due to some bizarre interaction within a module I created and then compiled to LIB... I will try to figure it out... but since it's a private LIB, Its no biggie
I changed the position of my second logcolor statement, but found that refreshing the execution while in rapid debug does make a difference.
ie, clean run into debug mode, logcolors show correctly, restarting (the red arrow next to the green stop square) without stopping the debugger can sometimes give the color integer and not apply the color to the log statement as shown in the screenshot. disabling and re-enabling log filters also reproduce the behaviour change.
The issue you are seeing is not related to the new smart strings feature. For some reason there is an additional character in the logs which prevents the logs parser to work properly.