I believe that Green is dominant, while Gray is recessive. In the case that some Genetics are blank, it doesn't mean that they don't have them-- it just means that you have yet to unlock {or research} that specific Genetic. From what I've seen so far, only green genetics actually make a difference on my Diablo.
For instance: Diablo's Light Bones genetic is green-- the description on Light Bones states: "Constitution is decreased by 25%, agility is increased by 25%."
When I check Diablo's Characteristics, his Constitution is in the red-- meaning his Light Bones genetic {and maybe others I've yet to unlock} have decreased it, while his Agility is in the green and has been increased just as the Light Bones genetic stated. If Gray had been the dominant gene {Normal Bones}, neither his constitution or agility would have been effected by it.
That's just my reasoning && notes on the whole genetics thing. xD