Sorry fellahs, I've owned the car 10 years now and never noticed the LED behaving in that way. It just flashes dimly when the system is energised. I just noticed it when I parked the car on a section of road with no street lights. I searched through the documents and found Subaru Category 1 Alarm Systems, Operating Instructions. Like normally, I'd never read them.
Perhaps elekie&a/c doctor can help me with the spurious problem of the flashing cruise control and steady engine alarm lights. It first happened when the car was three months old. It occurs randomly, it could happen twice a month or several months between occurances. The effect happens when I switch the ignition on. To make it stop I have to start the engine twice or three times. A handful of times I have had to start the engine a maximum of four times. The original dealer went bust so I asked another dealer a couple of years ago whether they could diagnose the problem and they said to bring it in. I've been down that route too many times to mention with the supplying dealer. They kept the car in for two or three days but couldn't find the fault.
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