[budge96]

Well if I were you I don't beleive I'd ignore it and whoever told you this is common for C4's is
an idiot and that should be your last question to him!
First thing if you have a manual check there for cues as to running problems and faults with
the four wheel drive mechanism on your car.
The early C4's had a complex clutch mechanism style coupling that sends a small modicum of
torque to the front differential unlike the later C4's that use q viscous or liquid torquing
mechanism.
My 993TT has a small reservoir for a vegetable oil fluid that needs topping only once every
two or three years if that..I don't beleive the earlier C4's have that reservoir but it might not hurt to check?
The idiot light must be indicating loss of torque on one or the other end so maybe the clutches in the transfer tube are in need of service.
With that car I would certainly consult a professional that knows what hes doing and can be trusted ..let us know what you come up with, thanks and good luck Bert