Was the Sdkfz 253 used in the Italian campaign? If so, were they painted panzer grey or dark yellow? Any help would be appreciated

Those were manufactured between 1940-41 and only 285 were made. Dunkelgelb was only introduced in 1943.
If any made it to Italy they still might have had the grey colour and something painted over it by the crew.

https://tanks-encyclopedia.com/ww2/nazi_germany/sd-kfz-253

If anything this might be a good concept how an sdkfz 253 would've looked like serving in Italy.

If I remember correctly, all armour remaining in dark grey should have been repainted yellow when the new regulation came in force.

Again from my memory, the 253 were replaced by beobachtungwagen and 251's so I doubt there were any in Italy. I maybe wrong, though.

Yeah, they did issue the paint out to the troops to repaint it. I bet this could be a cool fictional concept of a lonely 253 in Italy with a patchy paint job on top of the base grey.