The indicator on my W124 flashes when the sensors begin to make contact with the rotor. Wet brakes complete the circuit more effectively than dry (hence light coming on during rainy days).
Also, slight rotor warpage is the reason why it "flashes" instead of staying completely lit.
When I do pull the pads, there is still over a third of the pad left, even after driving 2K or so miles after the light first comes on...
2009 ML350 (84K) - Family vehicle
2001 CLK430 Cabriolet (71K) - Wife's car
2005 BMW 645CI (124K) - My daily driver
2012 Mustang V6 (60K) - Daughter's car