I recently turned on my HM700 and found the picture completely washed out, mainly yellowish-green or pinkish-purple. Have reset everything, played with white balance, looked through manual, message boards etc to no avail.

Any ideas what could be going on here?

Once I had similar experience with Sony camcorder right during shooting.
Blue CCD was off, because ribbon cable from CCD unit was damaged (oxidized).

Your camcorder is knackered.

I had my CX730 suddenly throw up random colors which didn't fix itself despite a hard reset and a soft reset via the touch screen. And a PJ780VE started malfunctioning too (the buttons behaved incorrectly). None of these camcorders were exposed to the rain or dropped or even knocked.

Sony service centre wanted a lot of money to repair it that it wasn't worth sending it in, so I just purchased another pre-owned one in the second hand market.