There has been such a discussion several times over the years.
AH's developers have gone on the record as starting that AH's system is intended to make enemies of different countries not stick out so much. You can probably do a BBS search for the various threads, if they're still available after all this time.
Personally I always preferred the "color per country" approach that AW and WB's used as opposed to the IFF colors of AH. I STILL wish AH would change its ICONS (especially since it would allow for smaller, less-cluttering icons, which is another pet peeve of mine). In all honestly, the issue is nothing new and I don't realistically expect AH's developers to ever change their opinion. It would be nice if it happened, but I'm not going to hold my breath on it.
I'd like a system by which you would be able to use 1 color per country, or remain with the IFF color system currently in use.
As an unrelated tidbit of trivia, AW's default colors were originally Red/Green/BLUE--Yellow became the default in place of Blue with the release of AirWarrior 2 in 1996 (AirWarrior itself dated back to 1987 and by most accounts was at its peak in the early '90's).
J_A_B