http://www.silkroadforums.com/viewtopic.php?t=197
Just gotta look and learn.
I think it works like this:
If the mob is blue, its 10+ lvls below you
If the mob is green, its 3-5 lvls below you
If the mob is white, its +\- 1 lvl from you
If the mob is orange, its 2-5 lvls above you
If the mob is red, its 6+ lvls above you.
Roughly...