Hello John @johnb
This is a very interesting subject you have chosen. I'm sorry to hear about the decals, but as Spiros and others have mentioned, the plastic indeed looks to be in very good shape. I have one of the Italeri kits, and two of the "upgraded" AmTech boxings of this very same kit.
I am concerned that since my kits are getting older, (like me), the decals that came in the box are likely brittle as well. Time will tell if they are or are not. Believe it or not, this is one of my favorite of the Luftwaffe inter war era biplanes.
Thank you very much for starting this build journal. I am definitely signed up for watching it as you work your magic on it. I am looking forward to seeing your next installments.
As far as the color choices, I would follow Pedro's @holzhamer
recommendations and stay with the RLM 02. He is one of our resident in house experts on the subject. By the looks of things in your latest photos, you are well on your way with painting the cockpit. It looks very good too.
Take care my friend, and stay safe.