Depending on the modem and it's firmware, the link or activity light may always blink. This is whether or not ARP packets are filtered out or not. ARP (Address Resolution Protocol) packets are just background 'noise' from others on your node. They have no affect on your speed.
On the SB6120, the latest firmware has caused it's light to start blinking continuously.
The best way to check traffic is the WAN light, or more likely, the individual port lights, on your router.