1 inch of coolant in the reservoir hardly seems enough to trigger the coolant light. the sensor in the reservoir is known to be quirky. mine acted up this summer and i merly cleaned it and greased it with silicone grease. i don't think it's urgent to flush and refill your coolant but as omegabenz says i would look into why it was low in the first place.
1993 300e-2.8 - gone now <sigh>
"Do not adjust your mind, it's reality that's malfunctioning"