I was having the same problem and the dealer was unable to fix it. Got a new switch, thinking the original one was faulty. The new one did the same thing. I found an obscure reference online. Someone obtained the following backdoor procedure from an authorized maintenance shop and it solved the "red flashing" problem for me, allowing me to FINALLY set a customer code.
1) sit on seat, starting light starts flashing blue
2) push the numbered keys one at a time in the following sequence: 1, 2, 3, 1, 2, 3, 1, 2, 3, 1
3)then push 1 and 3 together and hold for approx. 3 seconds. This turned the start switch to flashing green (start enabled) and evidently resets the switch, and allowed me to successfully program a custom code using the manual’s instructions.
Kudos to Allan Weed - This problem was frustrating me to no end.
However, his instruction was a bit ambiguous - at first I tried pushing the 123 keys together 3 times... no joy. Then tried his instructions pressing one key at a time and it worked!!!
To clarify:
sit on seat, start key light starts flashing blue
push the numbered keys one at a time in the following sequence:
1, 2, 3, 1, 2, 3, 1, 2, 3, 1
then push 1 and 3 together and hold for approx. 3 seconds.
this turned the start switch to flashing green (start enabled)
I then followed the manual's programming instructions step by step, and this time, instead of flashing red when I entered my custom code, it turned green.
Evidently this is a secret code provided to authorized maintainers so that they can fix mowers without knowing the customers' custom codes.