The same exact thing happened to me with my 1990 760 turbo. I checked the code and it read 5, just 5 flashes in a row. I too was confused by this, and i reset the code as per the faq, but it still persisted. I took apart the housing covering the steering column, and there is a flat gold pin connected to a square black connector maybe 3/4 in long, right behind the steering wheel on the bottom side. The connector must be ALL the way on! I at first thought the connector was on right, but then it went on about another 1/4 in. I then reset the fault codes and the light went off for good. It is hard to push the connector on, you may have to use small needlenose pliers or the like. ON A SAFETY NOTE ALWAYS DISCONNECT THE BATTERY WHILE WORKING ON ANY COMPONENT OF THE AIRBAG OR STEERING SYSTEM FOR YOUR OWN SAFETY. Also when reseting the fault codes stand to the side, im not sure whether that could possibly trip the airbag but I'd rather try to keep on the safer side at all times.
Dan