Not quite sure why you're not getting color when the standard lights are on in the room. Even one standard CFL bulb in a lamp (equivalent to 60 watt incandescent) will make mine jump to day mode. If you shine a flashlight at it or move the camera into a brighter location, does it flip to day mode? If so, then just try adjusting the sensitivity to make it as sensitive as possible. Also try it with "Smart IR" set to "off" and see if that makes any difference.
As far as the image quality goes, I would set the WDR to off, as you typically wouldn't need this indoors and from my experience, the WDR on these new 4mp models gives a very washed out image. I think you'd be better off cutting the WDR off and then increasing the brightness to like 50 something or 60 something. Lower the contrast some...Increase the "gain" to 100...Lower the saturation to the 50s or 60s range. That should give you a good picture in a room with lights on. May need to change the white balance setting to the type of light bulb you're using if the auto white balance doesn't reproduce the colors correctly.
