Add this code:
// Add this in the LoadGraphicsContent method BEFORE your ModelAnimator has been created
// but AFTER you have created your view and projection matrices
Effect myEffect = content.Load<Effect>("MyPaletteEffect");
foreach (ModelMesh mesh in model.Meshes)
{
for (int i = 0; i < mesh.MeshParts.Count; i++)
{
ModelMeshPart part = mesh.MeshParts[i];
BasicPaletteEffect effect = (BasicPaletteEffect)part.Effect;
part.Effect = myEffect.Clone(graphics.GraphicsDevice);
part.Effect.Parameters["BasicTexture"].SetValue(effect.Texture);
part.Effect.Parameters["View"].SetValue(view);
part.Effect.Parameters["Projection"].SetValue(projection);
effect.Dispose();
}
}
Running the program now will reveal the animated dwarf.