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Not much help with the Corolla, but I have a similar issue with my 94 Landcuiser. One way people have been able to "fix" it is to lube the cruise actuator that pulls on the cable or adjust the cable. If that doesn't help, then its probaly time for a new actuator.
I've found that on my LC, it will hold at certain speeds better than others. Seems to hold fine at 50, but at 65 it would start that blinking thing you mentioned. The only way to fix it is turn the car off and back on to reset the cruise computer. Sometimes it does this, other times it actually holds for a while. Does yours always blink, or does it work intermittant?
Now, I just recently purchased a 2001 corolla, and the cruise works around 45 when I tested it... but at 70, it doesn't seem to hold.. but it doesn't blink at all either.
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'01 Corolla LE (The gas Miser)
'89 Supra Turbo (Blitz Nur Spec, Michellin Pilot Sports)
'94 Land Cruiser (ARB front, Kaymar rear, sliders, lifted and locked)
Last edited by gbell210; 05-15-2011 at 08:31 PM.
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