Just a clarification for our wonderful British friends across the pond, in the US, high speed passenger engines were often equipped with a rotating Mars light or a Gyralite headlight (the upper light, usually, on an F or E unit from EMD or a PA from ALCO). It's purpose was to alert pedestrians and motorists of the approach of a high speed train. These lights were equipped with two lights, one with a clear lens which produced a gyrating white light and was normally used in regular operation. The other had a red lens and would automatically come on if the train went into an Emergency Brake application, either from a broken air hose or by engineer application. This was to warn workers and opposing trains that this high speed train has just gone into emergency braking and may well become a high speed derailment! Time to do an about face and run away from the tracks!
Marc's engines are equipped with these red Mars or Gyralites and they go on when you go into Emergency. The term "Penalty" comes from the game, wherein you are usually assessed a penalty period of time during which you cannot release the brakes if you go into Emergency.
Since the advent of Bin 1.6.1022 this light is on, with the white light, whenever the headlight is on full, giving a nice pink glow to the countryside.

It worked "as advertised" under Bin 1.6.0922. Marc has detailed the .eng file entries for this light above.
Hopefully this sheds some light.
