I love UFO stuff! And hey...It's more believable than anything World Net Daily and Newsmax reports combined.
What are being seen here are most probably small particles of ice or other debris which originated on the shuttle itself. The 'blinking' is characteristic of the tumbling of a reflective object of non-uniform shape.
BTW, there is no evidence whatsoever that the camera operator tried to move his aim to 'hide' the "UFO".
--Boris