I found an interesting grammarian blog on this very topic. Essentially, the post avers that puce is dark purple, but acknowledges the false notion of a "puce green" still persists. (It's theorized that the term might be an adaptation of puke green, but also readily acknowledged that there's no strong evidence to prove that notion.)
Also, I found a dress on Ebay today that was described thusly:
This fabulous Chetta B size 14 cocktail dress is created in a gorgeous
deep, rich eggplant purple with a shadow of puce green in a beautiful
brocade that is 100% silk.
I suppose that would mean the dress in question is puce-on-puce?
Lastly, I typed "Puce dress" into Google's search engine, and then clicked Shopping; this is what showed up on my screen:
The conspicuously un-puce dress in the middle is being sold as used, so it might disappear from the search query results in a few days. However, it does present some tangible evidence that some people indeed mistakenly refer to pea soup green as puce green.
As for why such misperceptions persist and become widespread, it only takes one exposure to misinformation to lock it into one's brain. This reminds me of a friend who once related how, while working on a project in his garage, he playfully asked his daughter to fetch him a "sawdonkey", making what he assumed was an obviously humorous pun on the word "sawhorse". Problem was, his young daughter didn't know what that object was called, so she simply noted the reference, and tucked it into her brain. Several years later, she was working on a stage crew in college, and it took five or six people to convince her that the object in question was indeed called a sawhorse, not a sawdonkey – she even called her dad that night to verify.
The earliest use, according to the OED, seems to have been in 1860 in the diamond industry, where it described a diamond that was ‘neither pure white nor any definite colour, and so of inferior value.’
Thirteen years later it was used to mean ‘Not of a colour considered natural, proper, or acceptable; paler or darker than expected or usual.’ Three years after that was in extended use to mean ‘Not in good health, slightly unwell; (also) not up to the mark, defective, deficient, out of order.’
Around the same time it was also in use to describe something that was ‘Of questionable taste, disreputable; improper, vulgar; specifically (of language, jokes, etc.) slightly indecent or obscene.’
Best Answer
My answer focuses on the first two of Josh61's questions—namely "Where does 'color blindness' come from? Was it imported from Germany as a more colloquial alternative to 'daltonism'?"
From a review of B. Joy Jeffries, Color Blindness: Its Dangers and Its Detection in The London Lancet: A Journal of British and Foreign Medicine (1880):
With regard to nomenclature, perhaps the most significant assertion made here is that "no treatise appeared in this country [England] on the subject till that of Wilson in 1855." Treatises may not have appeared, but an article titled "Daltonism" appeared in Knight's Penny Magazine, volume 1 (1846), which never uses the term colorblind, but offers the following classification terminology, based on the conclusions of "Professor Wartmann, of Lausanne," who "presented a paper concerning it to the British Association for the Advancement of Science, in 1841":
Wartmann's article "Memoir on Daltonism {or Colour Blindness}," as read at the Société de Physique et d'Histoire Naturelle de Genève on April 16, 1840, is reproduced in Scientific Memoirs, Selected from the Transactions of Foreign Academies of Science and Learned Societies, and from Foreign Journals, volume 4 (1846). Wartmann explains the choice of the name Daltonism thus:
But in a subsequent footnote, Wartmann defends the choice of the name Daltonism in the name of scientific continuity:
The issue was so delicate, however, that the editor of Scientific Memoirs deemed it appropriate to append another footnote regarding the name choice:
A review of Wartmann's Memoir on Daltonism and Brewster's Observations on Colour Blindness, or Insensibility to the Impression of Certain Colours in The Princeton Review (July 1845) offers this account of the naming controversy:
So colo[u]r blindness originated with Sir David Brewster, who disliked associating the illustrious name of Sir John Dalton with an imperfection, albeit one that Dalton possessed. The original term daltonian is harder to pin down. In exculpating himself, Professor Wartmann attributes the original choice to unnamed persons at the Academy of Geneva and secondarily to Professor Prevost writing in 1827. Adding a truly dissonant note to the proceedings was Professor Whewell's counter-suggestion Idiopts.
One can only wonder whether the subsequent course of terminology in English would have been different if the editor of Scientific Memoirs in 1846 had dared to go beyond the province of a translator and had changed all of Wartmann's instances of Daltonism and Daltonian to Parachromatism and Parachromatic.