If the coolant level drops to the point where the "low coolant" light illuminates the engine won't overheat because there is still plenty of coolant in the system - just as your engine won't be damaged if the oil level drops low enough to illuminate the oil level indicator. They are both warnings that these fluids are at minimum level and should be serviced soon.

Has the coolant been changed recently? On a coolant change it might take a few heat cycles to purge all the air out of the system, and air in the system is indicated by a dropping coolant level. Following a coolant change, level should be checked after every cycle and coolant added as necessary. Once the level stabilizes, all the air has been purged.

The coolant level line on the plastic expansion tank is the "full cold" level. At operating temperature the level should be about to 1 cm above this line.

Lack of pressure holding is indicative of a faulty pressure cap. Most autoparts stores have testers to check them, but be sure you buy a cap that is correct for you model: "120" caps hold 1.2 Bar. "140" caps hold 1.4 Bar.

Duke