I think the red flash is definitely a wrong move, due to the "liminalness" thing Blogorus pointed out but also:
If the screen becomes more difficult to look at, you're incentivised to change it asap. You change it by moving your cursor away from your target. If you move your cursor away from your target - you're not looking at what's threatening to kill you. It makes a player physically uncomfortable while looking at a perspective high level target and pondering how to kill it (rather necessary thing to do in DD). It's really difficult to do math when the screen is glaring red at you.
Heck, I can see it making the game rather unplayable for at least some people out there. I'm not even sure what the rest are getting out of it - not being aware something will kill you if you click on it leads to a learning experience. Wasn't what people were complaining about the wholy-beyond-your-conrol-misclickery which by default can't be fixed with warnings, as not being able to heed warnings and still dying is the whole point of it being so universally hated?
This measure sort of just makes it slightly more difficult on the eyes to tell why something that is going to kill you is going to kill you...
HERES AN IDEA: If you could make the cursor become a red skull&crossbones or something while mousing over a deadly enemy, I think it would do much better.