Like many Milano owners, I had an ARC that tended to go haywire when either it was very cold, or when multiple lights came on. So I spent some time with an EE friend, and I think we've found a fix for at least some cases of the ARC blinking lights.
Most people (including myself until I took it apart) assume that the issue lies with the ARC computer itself and that the display board is just "dumb" circuitry, but this isn't the case. There's some digital processing going on in the display board as well. Folks blame the ARC computer, but I've done a whole lot of parts swapping and testing it looks to me that a lot of the problems originate in the display board.
Here's the deal: the ARC computer talks to the display board via three wires in the connector. There's a data line, which encodes which lights to flash as an (up to) 30-bit data stream. This is interpreted by three 10-bit LED driver chips on the board. There's a clock line to keep the two boards in sync, and then there's a strobe line that's used to signal the driver chips to light the LEDs. In addition there's one transistor (which is used by the ICs to drive the 12V master warning lamp) and there's also a NOR gate chip (which possibly handles the big alarm light and the ARC clear button). All of this circuitry runs at 5V, which is stepped down from the car's 12V by a voltage regulator chip.
Other than that, there's not much on the display board. There's three capacitors that I thought might have gone bad with time, but they're only used to clean up the voltage on the 12V/5V lines and they tested good. ICs, transistors, and resistors don't generally go bad, and all the solder joints looked good. That left the voltage regulator. Using a can of freeze spray, I was able to isolate that cooling the regulator made the lights go haywire.
I also did some multimeter testing and here's what I think is happening. The LED's and the chips are both run off of the 5V output of the voltage regulator. When too much power gets drawn off of this line (i.e., when multiple LEDs light up) the output of the voltage regulator goes a bit haywire which makes the ICs start to malfunction. I'm not sure why cold makes the problem worse, but suspect that it's just a crappy part and doesn't have good thermal performance.
I pulled up the spec sheet for the voltage regulator and it's only rated for 500 mA output. Thinking this might be too little, I got a $1.59 voltage regulator from Radio Shack (P/N 276-1770) that has the same voltage in/out but is rated at up to 1 A output draw. I desoldered the old voltage regulator, drilled off the old heat sink (probably the toughest part!) riveted the heat sink to the new regulator, and soldered it into place.
The result is an ARC that correctly lights up multiple lights and doesn't go haywire! I did my work on a "bad" display board that I purchased for testing. As it came to me originally it would go haywire all the time, even when no lights should be lit. With just the change of a $1.59 part (and no changes to the ARC computer, cleaning grounds, or any other such stuff) it started working perfectly. The best part is, it now even works first thing in the morning when everything is cold.
The Radio Shack part is at the link below. The pinout of this is exactly the same as the existing chip.
+5V Fixed-Voltage Regulator 7805
The pic below shows the parking brake light and all four door lights working properly, with no blinking. Boo-freaking-ya!