Show us screenshots of the comp and your timeline with the effect settings. Distortion effects normally don't change the appearance of the colors, so something specific is going on here.
Ah. New to AE. Well, the application's used a lot but the most charitable thing you can say about how it works is....
i.e. you really have to know the basics or you'll get lost so fast it'll make your head spin.
I STRONGLY recommend that you get some basic training so you learn the weirdness and quirks of AE:
I can pretty much guarantee that at some point in the training you'll think to yourself, "Now why on God's Green Earth did they make it work like THAT? That's crazy!"
And the only adequate answer is, "well, that's the way it's always been one." And that's why learning the basics is so valuable. You lear to accept the weirdness.
Wave World only makes greyscale maps. It is intended to be used to drive other effects. You could use it to drive Displacement Map or Caustics. Probably Caustics, but I don't really know what you're trying to do.
There are other effects (like Ripple) that might do more what you want.