Let me begin by first apologizing to OP, and anyone else wondering why I, not being the mod's author, am responding to a 3 year old post.
Sorry everyone.

Second, as of last I played this mod; Yeah, the dis-organized pallette is a massive pain-in-the-arse.
I fully agree it needs better sorting.

Third though, is this line:

Originally posted by Sentient Anomaly:

This mod could really use a system for grouping them up by type/faction/shape, or a filtering system that only shows blocks with a certain criteria.

As far as I know, that is supremely unlikely, it would require a complete ui overhaul, for very little gain. (frankly, only this mod would benefit)

That said, the mod's author (or anyone with enough time, willpower, and the RWDK) could develop a few variants of the mod which could help the organization problem.

To wit: The game "sorts" the initial pallette purely by block ID, so block 1 is first, block 12 is twelfth, etc, etc.

The existing block order is basically the same as the existing factions in series, after the mod's cores.
And the vanilla factions were not well organized.

Re-numbering those into, say, cheap-hull (squares, then rhomboids, triangles, pentads, gemeralds, other), medium hull, heavy/hard hull, armor/special hull, thrusters, weapons, shields, reactors, R-storage, R-generators, and finally factories, would be quite a bit of work.

Doing other variants would be just as irritating of a time-sink, though I would celebrate if someone did them.