Is there a large speed increase due to atlasing?

The short answer to that is yes; having your images in a few large textures, means those textures can remain bound the the appropriate texture stage longer during the construction of the frame. This allows effective batching.

I should also add it is just about required for using HTML5, as each induvidual image needed results in an http call, which is comparatively extremely expensive during load time.

Not having tons of graphical experience I will begin trying this out to see if my project benefits from this method. :)

You may want to check and see if your library already does this, some 2D libraries/apis or sprite libraries do, for obvious reasons.

Currently the game I am designing does not have any 2D libs or apis. They are all very small programs wrapped in a single container.

Question: On your "2D Character Composition" image, you show the different pieces being multiplied by the color for them to use. So it makes sense that they are quite reasonably grayscale images.

Why isn't the armor greyscale also?

Also, the armor is dark bluish but has a gold belt. Multiplying the armor with a color would unfortunately change the armor's belt color as well! But, that can be avoided by making the game only multiply colors that have all R G and B color channels equal. You can have greyscale for multiplying, but anything "off-grey" or not grey wouldn't be colorized. See here for what I mean - alas, but I still can't find the original GameDev.net journal on that. =(

It didn't have much details, but I'd like to cred the original author at least once!

I think this idea would work especially well with your existing system.

@Servant of the Lord

The reason the armor isnt grey in this case, is it illustrates that you can use a detailed multi-colored piece of equipment, as long as it is multiplied with white. (not dyeable).

As you pointed out a straight-up multiplication will affect everything.

They grey-only multiplication trick is a cool idea, though sadly it can't be used to preserve bona-fide greys.

I may eventually implement 'spray masks' if I wish to do multiple colors per piece of equipment. The idea is just dicing up the equipment into parts, and colorizing (or not) those components seperately.

This would allow highly decorative items, while still having an ability to 'spray' on a dye in certain areas.

If you read the post I linked to, you can see a clever way someone showed me to add multi-colored pieces of equipment without using 'spray masks' and without damaging any of the work you've already done or having to redo any of your existing assets (dicing up equipment is also not needed).

You just apply your dyes only to the parts of the armor that are pure grey (where all three color channels are equal, such as rgb(210,210,210)) and any non-grey parts keep their color (such as rgb(210,210,211)).

If you ever actually need the feature, that is. I tend to get bogged down writing alot of features I probably don't need in my development, and dragging out development longer.

Yes, I understand what you're saying. But as I said, it still doesn't allow you to preserve grey areas that are meant to be grey.

Spray masks would allow for that, but it is more work; I'm also not sure how well the grey-only colorization method would work with gradients; but it would probably be fine with pixeled graphics.