That means xboxdrv isn’t running. See what happens after running through setup option 1. You may simply need to add that additional line to kill xpad in rc.local.

Alternatively, you can add xpad to the blacklist, which will also keep it from running (and taking over your controller). To do that, add the following line to /etc/modprobe.d/blacklist.conf:

blacklist xpad

EDIT: wait, pos 1 blinking? that’s really odd. These should be the only options according to the xboxdrv manual.

Num Behavior
0 off
1 all blinking
2 1/top-left blink, then on
3 2/top-right blink, then on
4 3/bottom-left blink, then on
5 4/bottom-right blink, then on
6 1/top-left on
7 2/top-right on
8 3/bottom-left on
9 4/bottom-right on
10 rotate
11 blink
12 blink slower
13 rotate with two lights
14 blink
15 blink once