Thanks for the input. Here's an update and answers to questions. This morning I visited a local Volvo/BMW shop (not the dealer) near my office. He asked if I'd tried to drive the car after parking last night, then explained that a few minute wait allows the computer to reset. Anyway, my answer was "no I hadn't moved the car last night", so that is what I did this evening. It operated as normal, shifted properly in Little Ole Lady driving mode, normal acceleration, hard acceleration, and downshifting...but the shift light still flashes.
I will try cycling the shifter as two folks recommended and let y'all know if it worked. In answer to the question about changing the fluid and flushing, I asked a dealer shop about that at least once and was told it isn't necessary...and the hard-copy service recommendations I have in the service folder only mentions checking the fluid every 10k miles. Just the same, I reverted to my upbringing and had a local Volvo shop near home (not the same one by the way) replace the fluid in Nov 01 around 102k miles. I doubt there was any flushing invovled because it isn't mentioned on the service record. By the way, back in Nov last year when the shift arrow began flashing, I did not have the PNP switch changed...just reset. It could be they did the "shifter cycling" thing and just said they reset the light. Thanks again.