First Things First! Who are the Green Lanterns?!

I sure can Shaman.

The reason you see every color of the rainbow nowadays is due to what is prophesised as "The War of Light" and "The Blackest Night" which states there will be 7 seperate Corps', all represented by a singular color of the visible spectrum, and all representing a different emotion. Red, Orange, Yellow, Green, Blue, Indigo and Violet. Along with this, there will be the "Black Lantern Corps" composed of reanimated dead characters.

I will cover all of this when I post my next section covering the other Corps and their purposes, powers, abilities and members.

Also, as to your question about the Yellow Weakness; it was retconned that when Hal Jordan went Nuts, it was because he was possessed by the entity of pure Fear, Parallax, this Entity WAS imprisoned in the central power battery on Oa, and since this is where the rings recieve their power, the reason for the weakness is explained. With the exposure of Parallax, the weakness is no more. Except for newly recruited GL's who are not aware of the Parallax entity.