As I understand it, it works like that both ways. While a swap-disc or modchip can alter the game's framerate from 50-60 or vice versa, it can't alter the actual color information.. NTSC and PAL handle color very differently, and they simply can't be swapped back and forth. Hence the black & white image, since the only thing it can get across cleanly is the luminance channel. The only way around it that I can think of is by using component RGB cables into an HDTV, since those actually break the signal down into it's individual pieces. Otherwise, you're just stuck with it for the BMW demo.
For Prologue, however, or the new demo that new just came out, you can get the Japanese version, which is already NTSC.