How can I make a list of dictionaries according to the Cartesian product of values in a source dictionary (“explode” the dictionary)?

I think you want the Cartesian product, not a permutation, in which case itertools.product can help:

>>> from itertools import product
>>> d = {'Color': ['Red', 'Yellow'], 'Size': ['Small', 'Medium', 'Large']}
>>> [dict(zip(d, v)) for v in product(*d.values())]
[{'Color': 'Red', 'Size': 'Small'}, {'Color': 'Red', 'Size': 'Medium'}, {'Color': 'Red', 'Size': 'Large'}, {'Color': 'Yellow', 'Size': 'Small'}, {'Color': 'Yellow', 'Size': 'Medium'}, {'Color': 'Yellow', 'Size': 'Large'}]

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