I swapped the bridge pickup wires. The sound is fantastic. In the middle, both pickups seem to be working at full power, with almost no loss of volume. Lots more bass than before, and much more sustain.
Yes, the vu meter needle moving and the Red light work fine for the peak .
Edit: I replaced the green light with a brighter one and now it works. Is it normal that when I'm at peak the red light comes on and the green doesn't go out?