Quote: "a)has the entity change texture over time or damage, specifically having one of the two colors grow to cover the figure."
Using the "etimerstart/etimergreater=x" and "alttexture=x" (x=0 or 1) will achieve this. You specify the texture and alt texture in the properties for the entity and using the "alttexture=x" will allow you to switch them. Take a look at the "switch1.fpi" script to see how it uses the texture switching. If you are missing, here it is:
;Artificial Intelligence Script
;Header
desc = Switch Activate (toggle on and off)
;Triggers
:state=0:hudreset,hudx=50,hudy=90,hudimagefine=gamecore\text\pressentertouse.tga,hudname=useswitchprompt,hudhide=1,hudmake=display,state=10
:plrdistwithin=50:hudshow=useswitchprompt,hudfadeout=useswitchprompt
:state=10,plrdistwithin=50,plrusingaction=1:state=1,plrsound=$0,activateifused=1,alttexture=1
:state=1,plrusingaction=0:state=2
:state=2,plrdistwithin=50,plrusingaction=1:state=3,plrsound=$1,activateifused=0,alttexture=0
:state=3,plrusingaction=0:state=10
;End of Script
Quote: "b) has it explode on death (I know you can do this without scripting but bear with me) or after time expires."
The entity can explode, and you can even spawn a decal (ex: smokes, sparks, etc) to add to the effect. All you'd have to do is modify the destroy script of the entity to activate the decal and destroy the main entity. To get an idea, take a look at the "destroyandactivate.fpi" script in "scriptbank\destroy" folder. You can see it will activate the entity name in the IfUsed field (activateifused=1).
If you try to come up with something and get stuck, post what you do have and we can help you get it sorted.

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