I think part of the oversaturated effect can vary on what kind of monitor one is using. On my laptop, it looks far more subdued than on a connected monitor. Overall, I do like the changes and don't have a problem reading the hud text unless it's right in the way of direct lightsources. The parts I'm not so enthused about are of course the local star spotlighting the galactic background to another hue and then a bit oversaturated in the cutter cockpit afffected white colors. I'd agree that it could be said the effect makes the color brightness and hues stand out more so that the skybox could look more "cartoony" but it's a cartoony on a relative level where it's still far tamer than NMS or even the X series where all the X games often had big splotches of nebulaic and neon colors (per the "Babylon 5" phase and popularity of colored space in sci-fi media at the time) and some fantastic if not realistic (our galaxy) looking system backdrops. I think X4 in fact toned it down and tried to have more simpler expansive looking backdrops similar to ED. I hope FD will consider offering some select options for the new lighting in the settings.
Anyone who's messed with parametric color gradient editing on images will have discovered that it's an incredibly powerful tool. It's also an incredibly "sharp" one too - it's
extremely easy to completely foul up the image by only being the tiniest bit "off" - I honestly don't think that FD made a "huge" error here, but the
result is bad out of proportion to the magnitude of the error. It's particularly obvious when you look at the galaxy when you're in a system surrounding an M-type, a red dwarf. It's less obvious when you're in the vicinity of a G-type or an O-type, but in both those cases a difference is still visible and the galaxy is yellower and dimmer than it used to be pre-update. If the most obvious case were less common it would be potentially overlookable but the M-class red dwarf is the most common star type in the universe - so in more than half the systems in the ED universe the galaxy is reduced to a fuzzy reddish smear.
FD don't need to back it off a lot, but they need to back it off some to avoid the skybox
looking like a skybox instead of like distant stars.