So my disco recently started flashing the M & S lights. I've had this happen before and my battery was dying. Replaced the battery and all was well. I tested the battery this time and it's fine. Still it was kind of old and I wanted a better one so I upgraded to an optima yellow top. Still flashing. Next I checked the alternator and it's fine as well.

From what I've read the XYZ switch can be a cause of this so that's what I'm looking into next. I'm not familiar with these but from what I read online this switch controls detecting gear positioning. When I shift, the lights on the shifter do seem a little wonky and they won't go past drive when I shift into 3, 2, or 1. I've honestly never paid much attention when shifting so I don't actually know if the light is supposed to go past drive but since there are clearly lights there I assume it should. I took a quick video, looks like it's too big to upload so here's a youtube link:
Based on this, is it safe to assume the XYZ switch is the culprit? If so, where are you getting these? Seems like a pretty simple part to swap out but they're out of stock on Atlantic british.

Thanks gents!

 

I had this same problem a couple weeks ago when I replaced the trans. As soon as I moved the lever I got flashing M&S, lights on the PRNDL went wonky jumping all over and/or not lighting in a repeatable manner, even got a CEL. I replaced the XYZ with the one that came from the original trans and this time all was well until I got to D, then I got flashing M&S and no LED on 321. Despite the truck starting fine I put a charger on the battery for a couple hours and the problem went away (still fixed 3 to 4 weeks later with only occasional starts and no miles). You may indeed have a bad XYZ (does sound like it) but if you haven't yet I would recommend putting a charger on the new Optima for a few hours anyway. It's a cheap thrill and I was astonished it fixed my problem as there was no other indication of a low charge.

 

Interesting. I can give that a try.

 

The MS lights usually start misbehaving whenever the battery gets low. Hook it up to a charger overnight and they might go away.

 

I had the same issue, and repairing the XYZ switch fixed it. Sometimes something electrically glitches, or a temporary issue with the XYZ switch will trigger the lights flashing. You can clear the code to make the car forget that it has seen whatever electrical glitch. If you don't have a code scanner, unplugging the battery for a little might work.

If the problem keeps coming back, then it is likely an xyz switch issue. You can repair it by taking it off of the transmission and cleaning the insides of the switch.

Keep in mind if you do not clear the code (P0705 i think) after the repair, it will still flash since the car still thinks it can not trust the readings of the xyz switch.
When everything is working, the red LED by D will not flash, and the LED next to the gear numbers will illuminate appropriately instead of being stuck in D.

 

Oh wow super helpful post and videos. Will definitely try this.

Mine isn't actually throwing a code for this. My check engine is on because I had my catalytic converters stolen and after the muffler shop welded new ones on it started throwing codes for the O2 sensor.

Also recently started throwing code P1668 which it appears to be something related to the anti theft system. I don't think that's part of my problem since it's a relatively new code and this problem predates it.

Thanks again though will definitely try this.