That isn't how you're supposed to use the Colours panel.
During the course of a session, PuTTY potentially uses all the colours listed in the Colours panel. It's not a question of using only one of them and you choosing which one; PuTTY will use them all. The purpose of the Colours panel is to let you adjust the appearance of all the colours. So to change the colour of the cursor, for example, you would select ‘Cursor Colour’, press the ‘Modify’ button, and select a new colour from the dialog box that appeared. Similarly, if you want your session to appear in green, you should select ‘Default Foreground’ and press ‘Modify’. Clicking on ‘ANSI Green’ won't turn your session green; it will only allow you to adjust the shade of green used when PuTTY is instructed by the server to display green text.