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On my 98, the factory system is called SecuriKey+.
There is a detailed instructional brochure that describes the various options which are enabled by various means.
The red led to the left of the steering column is actually a push button.
If you turn the ignition to on, and then push the button, so that it is in the outer position, the alarm should be activated, and should blink after you exit and close the doors. Do you observe this particular action?
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98 Camry LE, 2.2L, automatic
50k miles, drop in K&N A/F
 recent timing belt, water pump
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