The problem you've been having trying to override this is that style inheritance is additive by default. You can change an option setting like FontColor, but what you can't do (easily) is to modify the style to be just like the original one, but as if there were no FontColor setting at all.
Inherited doesn't work because it just tells the style cell to look at the style that it's inheriting from. Automatic doesn't work because, for purposes of foreground color options, Automatic is synonymous with RGBColor[0, 0, 0, 0].
You could copy it, though. So here's the original DisplayFormula style as it exists in v9:
(*In*) CurrentValue[{StyleDefinitions, "DisplayFormula"}]
(*Out*) {CellMargins -> {{66, Inherited}, {Inherited, Inherited}},
StripStyleOnPaste -> True,
DefaultFormatType -> DefaultInputFormatType,
"HyphenationOptionsHyphenationCharacter" -> "\[Continuation]",
LanguageCategory -> "Formula", ScriptLevel -> 0,
SingleLetterItalics -> True, MenuSortingValue -> 1700,
FontFamily -> "Arial", FontSize -> 14, FontColor -> GrayLevel[0.2],
UnderoverscriptBoxOptionsLimitsPositioning -> True}
What we want is exactly that style, but as if FontColor had never been set. We could synthesize a new style cell by selective copy/paste/typing, but let's write a program to do it. That's more fun. :)
Run this code in a notebook whose stylesheet if Default.nb (not your customized version).
NotebookWrite[EvaluationNotebook[],
FlattenAt[
Cell[StyleData["DisplayFormula", StyleDefinitions -> None],
DeleteCases[CurrentValue[{StyleDefinitions, "DisplayFormula"}],
FontColor -> _]],
2]]
Working our way from the inside out, we start with the current definition of DisplayFormula. We strip the FontColor setting using DeleteCases. We put it in a StyleData cell with StyleDefinitions -> None. This tells the FE that, for purposes of style inheritance, this style cell should not be merged with any parent style at all. Finally, we flatten the list into a sequence, which now gives us a proper cell expression to write into the notebook.
From there, copy and paste it into your custom stylesheet and you're golden.
InlineFormulain anItemParagraphcell is the same with the stylesheet setting (RGBColor[0.501961, 0, 0]). $\endgroup$