The two boxes are meant to be different types of lighting. The box on the left is a warmer, yellow lighting while the box on the right is a colder, blue lighting, which you can tell from its effect on the grey background. The portions of the dresses inside of this “lighting” are the exact same colors, which I tried to help demonstrate with the second picture. The portions of the dresses outside of the “lighting” represent their real color without any lighting affecting them.
The point of the image is just to show how two different colored dresses could look exactly the same depending on the lighting. At the same time, the real dress from the original image is seen as different colors by different people because brains are weird and they interpret the lighting differently.
Some people see a gold and white dress in a blue-tinted light like they’re in the shade, while others see a black and blue dress that is overexposed by a bright yellow-tinted light.
Remember that he didn’t just enter the avatar state during the northern water tribe attack, he spiritually fused with the raging ocean spirit. I feel like that gives him a bit more moral innocence than just straight up killing people on his own. It’s also worth noting he almost did exactly this. After smacking his back on the rock and reawakening his avatar state, he barely regained control before straight up killing Ozai.
That said… I actually hate the way he solved his unwillingness to kill the fire lord. An entire season of struggling over it and then suddenly some deus ex machina lion turtle pops up out of nowhere with no foreshadowing and just gives him the answer right before the final fight. Super lame and unearned ending to his moral struggle imo.