Let me just say, so I'm not catagorized w/ those who do this.
I DO NOT agree w/ dying a Yorkie's coat (anywhere) if I were going to be SHOWING it in any venue or BREEDING it. Hopefully the second comes after the first!
Even as a pet, I have never done it, but don't necc. disagree w/ a neutered pet being dyed.
I imagine that it'd be fun and there is no need to worry about misrepresentation! The Yorkie in question isn't going to be adding to the gene pool and therefore color matters little! It's no different than someone dressing up their child for halloween in my opinion.
Just know that I would NEVER dye my Yorkie's coat for any reason if I were showing her (which I am) and/or breeding her (which I may-if she turns out, but even then, probably not. My mentor will advise me!).
jm2c