Still not clear if it's the Mac or the display button flashing...
Can you count the beeps or flashes on the Mac?
1 beep = no RAM installed
2 beeps = incompatible RAM types
3 beeps = no good banks
4 beeps = no good boot images in the boot ROM (and/or bad sys config block)
5 beeps = processor is not usable
In addition to the beeps, on some computers the power LED will flash a corresponding number of times plus one. The LED will repeat the sequence after approximately a 5-second pause. The tones are only played once.
Note: In this case, a flash is considered to be 1/4 second or 250 ms or greater in length.
http://support.apple.com/kb/HT1547
If one of the Apple LCD displays detects an error condition, the power LED will flash in a certain pattern to indicate the issue.
Pattern Meaning
short, short, short
The display is detecting wrong video format or an unsupported resolution.
Verify that your equipment is compatible and restart the computer. If the issue continues, reset the PRAM.
short, long, short
Make sure you are using the correct power adapter with the display. This alert will only appear on displays built in 2004 or later which require an external power adapter.
short, short, long
The display is detecting a backlight error. Check your display's power connections and restart the computer. If the problem continues, contact Apple or an Apple Authorized Service Provider.