A friend recently had a MMM that blinked yellow and red. I tried his servo it on my MMM and same problem, than I tried my servo on this MMM and problem solved. Conclusion: his servo was dead / causing the problem. Try to swap the servo and check again.
Once you use liquidtape the warranty is avoided (IIRC), it's a choice you make and you will have to deal with the consequences. Besides trying to ''cheat'' on CC, which isn't fair, it's not smart (to say the least) to say so on RCM in the CC part of the forums
@ freddy, not everyone is so lucky. I've read tons of MMM's dying because of water. If you are running in water just liquidtape the thing and face the fact that the guaranty is over.