I confirmed with Aphex that the LEDs should light up on the Punch Factory when on or off. I guess it runs a second circuit to the leds in bypass mode. But I couldn't get a clear understanding from them as to how to interpret the LEDs. When I use the Punch Factory the LEDs seem to stay the same whether the unit is on or off. The drive knob also controls the LEDs whether the unit is on or off. Does anyone have a detailed explanation of how to use them? Am I missing something simple here?