Discovered if ColorRect is Toggled Visible, it later conflicts with the Pause Menu buttons mouse detection events. Would it be worth setting it to .hide() in a _ready func? Found
ColorRect, and all Control nodes have a Mouse drop-down in the inspector. You can set the Mouse Filter property to ignore so it doesn't intercept mouse events.
When it's behind other UI elements, it shouldn't conflict with them. It only intercepts mouse clicks if you click on it.