There are two ideas here:

1. Add liquid form of dyes
2. Get dyes from washing colored wool

Idea 1) Liquid dyes
Creating a liquid form of a dye and using that in recipes could result in less dye resources needed and interesting automation. For example, instead of 1 red dye + 1 white wool = 1 red wool, we can use say 50mb of red dye + white wool = 1 red wool. Same for other colored blocks and ae2 paint balls.

We would need a way of creating liquid dyes and I would propose either a compacting recipe that squeezes a dye into 500mb of liquid dye or a mixing recipe that desolves a dye into 500mb of water for 500mb of liquid dye. Each colored dye would need it's own liquid form (e.g. blue liquid dye, green liquid dye).

This would make it much more beneficial to prefer creating the liquid dye and using that via automation, via just crafting recipe with regular dye. Could optionally disable some of the crafting recipes...

This first idea I've tinkered with previously using KubeJS: https://gist.github.com/LegendaryTot/795f67a4a499564b9c227f62e2ac0136

the bottom half of the script is for a paintbrush idea, you can ignore that)

Here's some GIFs:

• https://imgur.com/a/DISbVGB
• https://imgur.com/a/HFaxo5r

Idea 2) Dye from colored wool

This idea is to help make dye renewable. Currently washing wool just gives wool. Suggestion is to replace that recipe so it has a small chance of giving the dye back. The chance needs to be lower than or equal to the cost of dying wool with liquid dye to avoid creating a cycle and getting infinite dye.

The example gist from above has this set to 10% chance of getting 1 dye.

I have been toying with a theming around colours, dyes, blocks for the resource overhaul in v2.1.
Would not be opposed to testing this script out and seeing what other uses it may find.
(Gives much more room to make players create farms and deal with liquids too)

I'd be happy to start a PR with the liquid dye at least. For dye renewal may need some more brainstorming as to whether having a colored sheep farm is a good idea for renewable dye (as it'll encourage having a bunch of sheep in one's base which may not be great for servers), or some other alternative.