does rubbing sandpaper over a plastic yoyo make it easier to grind on and does it change color?
It might make it easier. It won’t really change the color per say. It might end up lighter/white/grey-ish over the main color, but then I think there’s some small buffering step you do to kinda rub down the scratches you just cut into your yoyo, it should then pretty much come back to the reguar color. Keep in mind that the sanding will most likely create some amount of heat, which, coupled with the fact that you’re scratching up plastic, will cause the color to appear to change a little bit.
This may not work as well with delrin yoyos that are dyed rather than the delrin itself being colored as a big block. Case and point is with the Strummol8 Guilia spintops: the black and white are fine, but the rest of the colors, if they take too many scratches, it may show through white as the delrin is merely dyed apparently after the body is made.
what does it do to a metal yoyo?
It scratches up the metal. This is what could be known as satining depending on how far you plan to go with it. If you keep going up to higher and higher grits, you could end up putting yourself in a position of wanting to polish it to a shiny finish!