I have finally figured out what causes the Orange lights.
The problem is related to EITHER:
The UPnP AV Server OR the iTunes Firefly Add-on OR BOTH.
UPnP AV Server:
When I upgraded the 1.08 Firmware, the UPnP database could no longer handle the files mapped from my previous Media Folder location. The refresh of the database stopped in the middle and would not complete,
and the Orange lights came on, as the drives shut-down.
FIX: Restart the DNS-323, immediately connect to the UPnP Server, and point the Media Folder location to a smaller folder. If the UPnP Server refreshes to the 100%, then the Orange lights will not come on again.
iTunes/Firefly:
After resolving the UPnP problems described above, I retested the iTunes/Firefly Server, as I suspected it was also another the cause of the Orange lights.
When I applied the Firefly add-on and launched it, the interface hung, and finally the Orange lights came on. I restarted the DNS-323, and tried to relaunch it, using the same trick which worked for the UPnP AV Server. I simply couldn't get it to work, so I went to the Add-Ons section and turned off the Firefly module. (See the recent Firefly post, where 7 out of 8 users could NOT get the Firefly Server to work correctly.)
Orange lights GONE. Clearly the inbuilt UPnP and iTunes/Firefly servers are quite dodgy, and are not completely reliable. The DNS-323 UPnP Server is NOT DLNA certified. It is quite nice and convenient, to run the Media Server from within the DNS-323, but when you look at the wide variety of UPnP Media Servers available today, which run with much more stability, transcoding, fast refreshes, and other nice features, I would suggest that D-Link should go back to the drawing board and get serious.