OK- I had the same sound on my old 740... went to check out the rear brakes and it was scary. You know that circular weapon that Xena uses? Well, one of my rear rotors looked like that, except the sharp part was on the inside, not the outside.Heh- that show was so cheesy. Anyway, it had completely separated form the hub of the rotor. Turns out the caliper had frozen and worn down the rotor so bad that this happened. So the clunk I heard was the caliper picking up and then dropping the remains of the rotor. And because of the great (when operational) braking system these cars use, I never really noticed any change in braking performance. Most of the older Volvo brakes are notorious for caliper seizing, due to ignored wear in the rubber boots on them. Especially on the 7xx series, from what I've heard.
It is also possible that your rotor(s) is just loose. Maybe the last time the brakes were done, the rotor slipped off the hub before the tire was put on good and tight. That's happened to me before, so now I'm extra careful when working with the brakes. Those little mounting bolts don't always do a great job of holding the rotors on; this, of course, is if you even have them.
One last thing that pops into mind right now is the caliper mounting bolts. I once had these loosen up on me after putting new calipers on(and not using loc-tite on the bolts), and there was a weird clunking sound. Only it would continue while driving, not just when applying the brakes. Tightened up the bolts, and all was well.
As for your radio light, I have no clue- I've got an aftermarket stereo in my car. The sound is far superior to the original radio that came in my 85 245.
Good luck with it!
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1985 245 205k and counting. Charter member of the Martha Stewart Racing Team- "It's a good thing"