When color coding bits, you don’t necessarily need a unique color for each bit. All you need is enough colors that, when they’re used in rotation, the difference between bits of the same color is obvious. If you really want to know the size at a glance, you still don’t need very many colors — if you use colors in combination, as the resistor color code does. Red Yellow? Oh, that’s 24…
Locksmithing pin kits take full advantage of this. There are typically only eight or so colors. That’s enough to distinguish between sizes a few thousandths of an inch apart. After you’ve gone through eight steps, though, the .003″ or .005″ increment has added up to .024″ or .040″, which is plenty large enough to compare by touch, to be very quickly measured with even a cheap micrometer, or to be checked with a “go/no-go” slot.
Woodworkers don’t generally need to be that precise, but the principle holds just as well when your steps are 1/64″ (or larger, depending on your kit) rather than 1/200″.