There is an app to change the colors and their meanings on the led so you can customize it. I forget what it is called I think missed calls or something like that. I didn't like it cause it messed with my ringer too and other notifications. If you want to use it to customize everything it would probably be fine. I had a hard time wrapping my brain around it all. There are a few more colors the Droid is capable of though.
The "lights" on the left side that don't light up are actually sensors. I had never noticed they were there till you said something and I got it in just the right light to faintly see that they are there. The one to the far left is the light sensor. It is used for the auto brightness function which is neat but can suck the life right out of your battery. The one to the right of it is basically an infrared sensor used as a proximity sensor mainly for phone calls. It shuts off the screen while you are on a call if the phone is by your ear so your face doesn't push buttons.
