My house is less than 100yds from the track, about 100yds before a crossing. I'm not sure of the train's exact position when it sounds the horn, but it's loud.
Your suggestion simply adds more electronics and more things to go wrong, plus a sign that nobody will read.
The sign would be for the engineer. If an engineer cannot be trusted to read signage, he shouldn't be driving a train. I'm not sure I see a particular difficulty with designing the system so that in case of failure the light for the engineer would definitely not blink. And in that case if the engineer is doing his job he will sound the horn (if the engineer can't be relied upon to sound the horn if the light isn't blinking, how can he be relied upon to sound the horn in any case).
Our almost-accident a few years ago was an idiot who drove around a large "CROSSING CLOSED" sign.
How often would having the engineer sound his horn make any difference.
When a problem with our crossing gates is reported, the trainmaster issues go-slow orders and all trains go back to sounding the horn until the problem is corrected.
I just feel better with the horn - one more chance for me to be warned of the train, if the crossing signals aren't working and somehow the engineer doesn't get the word. But most of the neighborhood is just annoyed by the noise.
We almost had time to get that Jeep off the crossing when we heard the horn, if I hadn't had to throw the dogs in the house before I got in the truck we would have done it.