Not sure what you mean by "a permanent dye" but I've found that the coloring either wears off the belt or is covered over possibly. Either way it doesn't seem to affect subsequent sanding on the belt.

Great thread! Thanks for posting it here - looks like at some point I may have to try this out. I'm already looking at extra cutlery of various shapes that I may be able to transform. But using a blank seems to be the best.