your candles look very cool, and I like the tapered cone at the top.
With respect, I think you might be losing out on one of Arduinos options, the pwm outputs on say pins 9,10,and 11.
With just a little code, you can have the option of the colours gradually changing through ( nearly ) the whole spectrum of colours. *
You could have a remote button to start it changing, and another to "freeze" the ramp, to match the restaurants colours for example...
You could also make the flicker a more gentle candle flicker by ramping it on and off.
* I used to make an LED mood light with just 2 quad op amp chips that controlled up to 16 lamps, and it gradually changed colour with no "steps" that you get with the normal micro mood lights. By connecting the various lamps differently you could get an infinate number of different colours gradually changing in different parts of the garden / restaurant
I've already gone ahead and started this. I'll be submitting it in the contest I think. I may not get it done in time.