Okay so after seeing this I knew that this must happen in IC2. 
Terraformer + Woolificator = Woolify your world! 
Natural blocks would only get changed
From the 16 colours (Ores can be optional): 
Pink - 
Red - Redstone Ore, Netherrack 
Orange - Pumpkin, Copper Ore, lava *as pointed out below, this will be problematic. A solution is that all the lava is turned into a different block first then into wool* 
Yellow - Sand, Sandstone, End Stone, Gold Ore 
Lime - Grass, Uranium Ore, Reeds
Green - Leaves, Cactus 
Cyan - Water 
Light Blue - Diamond Ore, Ice 
Blue - Lapis Ore 
Purple - 
Magenta - 
Brown - Dirt, Wood logs, Iron Ore, Soulsand 
Light grey - Gravel, Mycelium, Clay 
Grey - Smoothstone 
Black - Obsidian, Coal 
White - Snow (this may turn up a little wierd), Tin Ore, Birch wood logs (if possible)
I think I hit most of the natural stuff and suggestions/changes are welcome. But seriously this would be awesome/funny to have.
Thanks! 
(Radius, EU cost, and recipe is whatever IC2 team feels it should be)
 
		