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Not sure but possible you are looking at two different issues.
1.. the arrow: this indicates the disengagement of the OD gear. Highly probable issues with the OD relay. I am assuming that with the arrow up the 4th gear won't kick in. Resolder or replace the OD relay.
2.. If (1) above holds true, then I would look for a lose ground. Check maybe the braided ground from engine to firewall.
Get more opinions. The "garage" is likely not a volvo specilist. Alternator/regulator/brush problems cause all lights to fliker or stay on. I would think it is more of a "supply" problem than a charging problem.
If this happens, and you shut the car off and restart, can it correct itself?
If so, you might simply have a problem with your ignition switch. I would look there to. The switch routes power to accessories etc depending on the position of the key.
Greg Mustang
Montreal
Canada
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