Red battery light

No, it's not normal. You could have a charging issue with the alternator, or the battery is getting weak. Get a digital voltmeter, and check the voltage across the battery terminals at idle. If it's not in the range of 13.8-14.4V, you have an issue. Might need a new alternator. Hold onto your butt if you do. Smart alternators are not cheap.
I had to put one in my smart at about 155,000 miles. I got lucky and found a low mileage used one on eBay for $50. I think remanufactured ones are going for close to $300 right now...

Oh, and another thing, find yourself another dealer. If they told you not to worry about a red warning light on the dash, they are either incompetent, or are trying to avoid working on your smart. Either situation is not good....

If you are looking for a good OBDII tool that works on the smart, get a blue driver took from Amazon. $99 and they work well with a smart.