Very fun game idea! I like color merging and ambiance of the game.
My only issue is the UI. If you decide to build out the game more, it would be cool to be able to select a sprite and have its genome display in a UI box. Also once you have a more than 10 or so, it's hard to see what's going on, so having a side panel to select your sprites by genome might help.
Selecting parents could also be more intuitive if instead of right-clicking them, you could drag and drop them to a nest. Here you could maybe also add a UI box showing a preview of the possible offspring it might produce. That would also make it more clear how the child's genome is determined.
That being said, he's very cute and could definitely be build into a full game! Hope my comments are useful!