Okay so here's what I figure about that heart: it's most likely a phylactery, it's the tether to this world. His heart is the manifestation of feelings before passing or regret with unfinished business.

It was yellow when we saw it because Lewis's sole fixation for staying on this coil at the time was revenge on Amarillo.

It became blue when his girlfriend came into the picture, changing from one reason to the next.

No idea about the dog though, maybe he was evil, took Amarillo's arm, but became part of the crew somehow?