This is a known issue in WM5 however I wasnt aware it is also affect in WM6.
Here is the link to
The most COMPLETE compilation of hacks and tweaks for WM5 and below is the hack for the LEDs
I shut off my blinking LED by going:
Hkey_Local_Machine/Drivers/Builtin/AllLEDMgr
And change the Index value from 1 to 0
Then soft reset.
This is for both the blue and green LEDs.
[EDIT. Note: This deactivated the vibrate mode on my phone]