FROM THE beginning of the takeover, the Wounded Knee incident was a reporter's paradise, Indians wearing war paint, U.S. marshals in baby blue jump suits, and demands centering around an 1868 treaty provided the national press with more copy than it needed. Long before the colorful descriptions became tedious and dull to the writers, the readers' attention waned.

Instead of a blood-and-guts ending, the kind that TV-educated Americans have come to expect from Hollywood, the dispute settled down to a waiting game between the Federal government and the militant members of the American Indian Movement. As the occupation dragged to a close last week, the atmosphere at Wounded Knee had no more excitement than a rerun of "Leave it to Beaver."

Which is perhaps as it should be. Most of the American press, known more for its emphasis on entertainment than issues, lost interest in the real problems at this tiny hamlet after a few weeks at the desolate Pine Ridge reservation.

Some of the nation's newspaper editors, perhaps still starry-eyed after their usual late-night diet of Wild West grade "B" movies, saw the takeover as another showdown between the seventh cavalry and Sitting Bull. The Detroit News ran a typical story in their March 25, Sunday edition headlined "Wounded Knee looks like the movies but cast is for real."

Other newspapers preferred to run stories that listed the criminal backgrounds of AIM leaders Russell C. Means and Dennis J. Banks, and took particular delight in reporting drunken driving charges. The stories, however, neglected to mention that Indians often are arrested even though they have done nothing wrong.

Unfortunately, it was difficult to ignore the visual impact of the events at Wounded Knee. The most powerful picture taken there shows AIM security officials capturing six Federal agents, who had ventured into the "DMZ" between the Federal and Indian roadblocks. A UPI photographer caught the six Federal officials, hands high above their heads, being led to the Indian security office. Almost every major newspaper in the country carried the photo the next day.

The news of the capture of the FBI agents swept through the village, and newsmen flocked to the scene to interview the captives. The well-trained agents were reluctant to talk with the press, and refused to answer questions.

One armed Indian who was guarding the prisoners soon broke the silence with a well-placed poke to the ribs. "The press is asking you a question," the Indian said as he nudged the FBI agent with his gun. "You answer."

The national television networks recognized the visual possibilities of the Wounded Knee story immediately; NBC, ABC and CBS all had camera crews holed up inside the embattled village. When the Justice Department ruled that Wounded Knee was off limits to the press, all three networks were permitted to remain inside, and a pool man was allowed to bring out film footage.

The Indians also recognized the potential of the TV press. Newspaper reporters often found it difficult to compete with the television microphones. One reporter almost lost an interview when a TV cameraman arrived on the scene. His Indian subject kept edging toward the camera.

In exasperation, the reporter finally said to his subject through gritted teeth, "Would you mind coming over this way. You can speak into my notebook."

The print media grumbled about the preferential treatment accorded to the TV press, but if the newspaper reporters felt bad about losing the inside track, they were just plain sick over the amount of money being spent by the networks for a few minutes of film.

NBC staff members groaned unconvincingly about how much money it cost them to stay in Wounded Knee. "We've flown 60 Lear jets in and out of here since this thing began," one NBC cameraman complained during the third week of the takeover. "We're going broke."

NBC, of course, was nowhere near broke. Ten days latter, it sent correspondent Douglas Kiker to the reservation, probably in anticipation of a possible bust. But no bust materialized, and Kiker delivered a report on "NBC Nightly News" that emphasized that Wounded Knee had indeed become somewhat boring.

As far as events in the village itself, boredom might have set in sooner if the press had not flooded the historic site. AIM turned away none of the reporters who could reach the village, and the top AIM leaders were accessible to anyone with a notebook, camera, or microphone.

Although many of the young supporters of AIM resented the presence of the press, the AIM leaders realized that the press was contributing to their hold on the besieged hamlet. Richard Wilson, the Tribal Council president whom AIM would like to oust, also realized the press's effect, and rammed a resolution through the Tribal Council that bars all non-residents from the reservation.

Although the primary purpose of the resolution has been to ban the National Council of Churches, Wilson also threatened to use the measure against reporters who had "aided and abetted the enemy [AIM]." So far, that threat has been just an idle one.

Wilson did, however, throw up his roadblock two weeks ago to prevent the press from entering Wounded Knee. The same day, the TV networks, concerned about the tense situation created by the shooting of a U.S. marshal, vacated the village for the first time since the occupation began.

After that withdrawal, the reports coming out of the village were unreliable. Most of the daily newspapers parroted the government line, or described obliquely the dissension among the militants. But no one knew in the occupation's sixth week what was going on inside Wounded Knee, and the Federal government probably wanted to keep it that way.