Anything is possible :)

1.  You can add a colour property to the Ball Class and either add a parameter to the constructor and set it when Ball objects are created, or just set it at random in the constructor.

2.  As for exploding balls: things get a little more complex...  For a start once a ball explodes you don't want to include it in any further collision checks and you don't want to call the default Ball display method on it.  The standard array used to store the balls in the example isn't ideal in this context and you're better off using an ArrayList.  Then when a ball collides with another you can simply remove() them both from the ArrayList.  For the explosion effect you could perhaps create a separate Explosion class and use this to trigger explosions at the balls' last known coordinates at the same time.