16 x 16 RGB LED matrix

Well that is 768 individual LEDs ! I suppose you want to control them proportionally as well. The problem with multiplexing is that the brightness will be a lot lower and as this is going to be big you need the LEDs to be as bright as you can get them.
This project is going to cost you a lot of money.
Have you considers something like the shift bright modules?
There are also some RGB modules and strips that Lady Ada do, check out their web site.