I've always seen the game's transitions as the obvious, a show of corruption. Though they do look ugly in some respects, it likely was meant to show a decay of the body, the veins more noticeable and the skin losing the natural color. But when you compare it to the bodily appearance of the movie-era Sith, the difference is vast. I'd think the idea between them was the fact that most of the Sith shown in the movies where likely either of a species where their look was definite, or a fallen Jedi, who, because of his(obviously because it seems that the movies lack in females aligned with the Sith, aside from Ventress) previous tenure as a Jedi, keeps the same hair color, skin tone and eyes that they had as a Jedi.
But I think the idea of the showing veins might be something inspired by "Interview With The Vampire". While it wasn't present on all Vampires in the film, it is most notably on Louie, even if it is just one. It may have been better if BioWare had resorted to tattoos rather than decay, even making the player fit in with Uthar and Yuthura. But that would have meant that Darth Revan would have tattoos, something that is a little redundant to design, as its seems they are unwilling to given Revan his canon appearance(s).
But it does seems odd that the eyes of the transitions, no matter if you refer to the textures done by BioWare or Obsidian, aren't the same as the movies. Some times the yellow used isn't even noticeable, mainly on the Xbox version(thought it may just be the way I saw them), as in K2 it seemed that the eyes were just plain white with black edges. Likely, this is because the Sith of the KOTOR-era used the force almost like one would a car, using it for some purpose every day. The movie-era Sith, however, would have used the power of the force in large doses, so when they displayed their anger, their more aggressive emotions, their body's only visual display was their eyes changing color. This also brings the idea, something that I think was said before in another thread, that the movie era Sith(namely Anakin in Ep3), didn't always have their "Sith-Eyes", unlike the Sith of the KOTOR era, that keeps them. While it is possible that the reason for the Kotor-era Sith's eyes not changing is due to limitations on the game's engine, the previous explanation seems a bit more interesting.