Hi John,
First of all, my apologies for not getting back to you more quickly, but I discovered that the 'flac+mp3' conversion process was updated a while ago so I had to run through some more tests on my B2s to see what the differences are.
The red flashing light indicates that the flac to mp3 generation is running.
To cut a long story short, your B2 will require about 43 days running 24 hours/day to complete this operation, so it is a somewhat slow process!
Another option is to use a PC based product such as 'dBpoweramp' which can be set up to automatically generate the 'mirror' folders and files. This is my preferred method and on my music collection of about 7200 flac files, it will generate the mp3 files in about 18 hours, so for your collection that would equate to about 2.5 days.
It does require a NAS connection between the B2 and the PC to be set up. NAS is already running by default on the B2, so it just requires some setup on the PC. I have attached a set of instructions for setting up dBpoweramp, so if you want to try this then let us know.
dBpoweramp is a free download from the Web, but it has a 21 day trial period, so you can run the process at no cost initially. Personally, I found that it is so good that I purchased a licence (i think that it was about £30 for a permanent licence for 1 PC).
Regards,
Peter.