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I've never seen a blue light on my Xoom, just white and green. I'm not sure if there's any RS members on here for Xooms, but you may be able to find an answer on XoomForums.com (it's the baby brother of this site, but strictly Xoom.)
The indicator light centered directly on the bottom. I'm aware it may be something to do with Bluetooth, but dunno. Haven't seen it in a week. Maybe its gone. Just thought it was weird because the Xoom was turned off.