Silly me. I typed '7' when I really meant '0xFF' :P Textures are now uploaded just fine. Remaining discoloration and flat-shaded polygons are primarily due to unimplemented 8- and 4-bit texture formats.
Also, Sega Rally 2 is up and running. Lots of geometry glitches so far. This one is a real stress test for the renderer because it seems to be doing weird things with the scene database and continually uploads textures in-game. It also makes the heaviest use of dynamic models (polygon RAM) that I've yet encountered.