Did I snip it right?
I don't see why asexual reproduction is not an example of a species "Breeding among themselves".
Concerning that very intelligent block of red, blue and all colors in between text. All it does it ask questions about the block of text and when one color become another. Perhaps it can be used to answer some of the more mystifying questions of natural selection:
If a red beetle turns into a blue beetle over the course of evolution, at what point was it a purple beetle?
The block of text is a good example of micro-evolution, and a change in degree. However, the kind of evolution that is required for fundamentally new structures and processes to come into existence is... well... fundamentally new.
It would be like starting the block of text with red letters, and slowly causing the text to change from English to Chinese. How would one go about that? English and Chinese uses different types of letters and symbols. Perhaps at some point the words would start alternating, 1 English then 1 Chinese, but there could be no single character that is 50% English and 50% Chinese that would make sense (especially since a single letter in English has less meaning than a single character in Chinese, whereas the letter L is a part of a word, while ? is an entire word by itself when translated into English). It would no longer be English nor Chinese, so it would not be relatable to the original letters nor the final letters in terms of how we understand it. It would not be a letter, as it would not be legible and would not mean anything.
In order to go from English to Chinese, a sudden change must occur, where at one point is it completely English and then at the next point it is completely Chinese. It cannot go from English to Chinese gradually, because the change that is ultimately occurring is causing the original text to change fundamentally, instead of just changing in degree such as the change in color shading.
Words going from red to blue is a good example of micro-evolution, like a red beetle experiencing micro-evolution and changing into a blue beetle by simply changing the shading of its husk. Words going from English to Chinese though is a good example of macro-evolution, whereas gradual changes over time (in the same form as your example exhibits) are simply not able to cause such a change.