Actually outside, they are only painting the castle. If you're leaving the first then you will most likely see a crane "In the lowered position" during the day. THe only construction that's going on is inside the Castle's Suite,
Here are a few pictures I took last week of the castle. I only saw the crane from the front of the castle in the morning, never in the afternoon. I never went to fantasyland in the afternoon to see what it was like behind the castle for it to disappear at the front. Sorry about the first picture being on its side - got confused within photobucket.
You can really see the difference with the shade of blue on the turrets, particularly one which is half finished (first picture).
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