I don't know for sure but the light may have just been warning you that there was tire slippage? Safety feature perhaps? If it was still active it wouldn't let you spin the tires much before killing the power. You only stated that the light was still flashing, not whether or not it was giving you full control of the vehicle.

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2007 E70 X5 4.8i Sport Package
8x,xxx Miles
"My Precious" (Smeagol voice)