Change your Pixelation Press Space It'll capture the image and re-draw it using Pen. I added a new pixelation algorithm, one which instead of just scanning every fourth pixel, takes the surrounding four pixels and finds the most common color. You can use it by doing a pixelation-one scan and pressing one after it's done. The reason all the whites look yellowish is that Scratch can only detect a color within about a 16-RGB value accuracy.
If you want to use this, I optimized it for pixelation, slowing down by a few seconds for pixelations of one. You should delete the pixelation variable and remove all the math blocks, as they slow Scratch down. Credit to Griffpatch for the tutorial I guess.