I think the question about the colour of the oil is so that you know where it has come from if you see a puddle under the aircraft. I must admit I don't know what colour it is
The Arrow hydraulic pump for the undercarriage is in the rear fuselage. You can take a peek if you remove the panel at the back of the luggage compartment...no tools are needed it has knurled nuts, you can also see the bit of the autopilot that moves the controls and the battery.
The pump pressurises the system to retract the gear and when the gear is retracted the pressure rises and activates a cut out switch. The emergency lowering lever just dumps the pressure and the wheels fall by gravity. The nosewheel will not decend all the way unless you slow the aircraft down. I was warned not to use the emergency lowering for practise without pulling the pump breaker on the panel. The problem is that the emergency lowering dumps the pressure so the cut out switch turns the pump on. This then means the pump is running all the time that you operate the emergency lowering. This can overheat the pump and/or wear it out.
I guess this is why they want you to know how the systems operate.