Collection Instance make no sense. And there is another solution

[DNorman]

I am not sure why you lose the materials they should be Ok.

Maybe you are loosing your randomization. Or the UV’s.
Check this thread:

For randomization this answer:

Geometry Nodes - how to realize instances with material?

The problem is that when you realize the instances they are no longer different objects and will not give a random value per object (they just give one value which is the value of the object with the GN modifier) You need to create a random value from 0-1 inside the GN modifier and output it to use in the shader editor to use as a factor for the colour ramp. The way I found to do it was this: [Index] What it does is I captured the index value of the points I used to instance the spheres, I …

If you are loosing the UV’s you need to use an attribute node with UVMap as attribute in the shader editor, Not the texture coordinate node. This is also discussed in that same thread.