If the Key Switches folder track is set to Default colour (grey) its (overview) events adopt the colour of the containing folder. This upsets the colour-coding and can give events a false prominence:
Key Switch folder at top level, events are grey, like they should be.
Key Switch folder within blue folder, events are blue.
Key Switch folder within purple folder, events are purple .
If the Key Switches folder track is set to a colour, the events are coloured correctly.