I don't know about the flashing lights, but it seems to me that the box is going into a 'get you home' mode.
I have a 307 which did a vey similar thing. I called a main dealer who put me on to an auto box specialist who said this was fairly common, and could be rectified by changing a solenoid.
As I was on holiday at the time I decided to leave it till I got home, but the fault only re-appeared once more and I have had no trouble since then.. This was two years ago and the box has been trouble-free since then.
So it might clear itself, or could be a relatively cheap repair by an auto specialist.
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