Lets assume your the type that likes to color code specific text, so names, places, items, specific events and or terms. with the names part if your color coding the names like: Monks, Sir Kaliven, Shadow Mages and so on, would you then color code some one speaking some one elses name when that person is in the room? example:

Bob: Jake you are late for school
Jake: I know, I'm sorry.

Would you color code Jakes name in bobs dialogue box based on the rules set above on what gets color coded? or would this be the exception because Jake is in the room?

I'd say you shouldn't color code the name if someone speaks directly to the person. In all other cases you should. (Like: "His name is Jake", Jake should be colored)

Agreed with what Dah0rst has said.

I have three major color codings: whisper text (or thoughts) as grey, tutorial text as yellow, and virtually everything else as blue. Color-coding is sorta like capitalizing magic words or something (which Tolkien and some authors did), it's good but you need to keep track it so you don't overuse it or forget about it.

The majority I notice tend to be quest orientated to make it more obvious to the player what is necessary to completion.
Eg. "We need to find the item in the place"
The item and place would be colour coded, and in this case names would only be colour coded if the quest was talk to so-and-so