Battle Event: Locke and the Merchant/Officer

In terms of making Shadow into Locke, you wouldn't need to alter any palettes as you could set the battle palette and change all instances of Locke as an NPC and when his graphics are assigned to load Shadow instead.

Here's the placements for it, as taken from a handy guide another user made.

Locke stays a character for most of the game. His properties are set in the introduction. I believe
the only time he's an NPC is in the Phoenix Cave. He uses sprite ID 0x01 and palette 0x01.

CC:A627 0x01
CC:A62A 0x01

Locke's sprite and palette change a lot during his scenario. When a merchant, he uses sprite ID 0x13
and palette 0x01. When a soldier, he uses sprite ID 0x0E and palette 0x00. His cloths revert if you
get busted or when you meet Celes.

CA:860E 0x13 (STOLE MERCHANT CLOTHS)
CA:8611 0x01 (STOLE MERCHANT CLOTHS)

CA:7DD5 0x13 (STOLE CIDER MERCHANT CLOTHS)
CA:7DD8 0x01 (STOLE CIDER MERCHANT CLOTHS)

CA:7EC6 0x0E (STOLE GENERAL CLOTHS)
CA:7EC9 0x00 (STOLE GENERAL CLOTHS)

CA:85C2 0x01 (BUSTED)
CA:85C5 0x01 (BUSTED)

CA:867D 0x01 (MEET CELES)
CA:8680 0x01 (MEET CELES)

For this to work fully, you'd just have to give Original Locke the intended Shadow moveset or assign his properties to him, either way works.