The USB should be yellow when it has power and red when it is plugged into a computer. When it is initialising it will turn organge and when it is working it will flash yellow/red.
So what does just a blinking red LED stand for? That is what my 5 miners are doing.
It means they are hashing. It just means that you have stopped the mining software and not reset the device before starting the software again.
Confirmed!
Stopping bfgminer 3.4.0 and restarting it gets the red LED flashing on and off.
Stopping bfgminer, pressing the RESET button on the usb stick and restarting bfgminer gets the alternating red / yellow.
There is no apparent difference in hash rate or error rate between the two scenereo's. The only difference is the pattern of the light.