Looking at the two images on my (reasonably well calibrated) screen, as well as my partner's Adobe calibrated screen, the color module and its CIELab conversion algorithms seem to do their job.
The two images are similar in luminosity with the exception that the Color-processed image has desaturated the reds in the darker areas somewhat. To the eye on my calibrated monitor, they appear of equal luminance (just one is colored, and one is not).
Can you make sure your screen is properly calibrated? It sounds like your screen is producing too much red. What sort of screen are you using?