Hmm, turns out this isn't quite solved. I've determined that the notification light depends on whether the screen is on or off, and locked or unlocked. If the screen is on, the notification light blinks. If it is off and locked, the light blinks. If the screen is off but unlocked, no notification lights. This happens for me even with a fresh PR 1.2 and emmc. I've created bug 10552 for this.