It is WAAAYYdown, underneath the steering column. Look under there and you'll find it. I have a 2001 1.8T Beetle myself.

The indicator comes on if there's a problem or it won't open due to Sunrook being open. If Sunroof is tilted open at 78mph, it closes. At 81 MPH, the spoiler is supposed to deploy. If you tilt the sunroof in the state of historisis (79-80 mph) you will get the indicator and no spoiler deployment at 81 mph.