small red lights flash on my Nakamichi PA-7

These lights indicate clipping

but sometimes the small red lights on the front of the amp blink or stay on for a second

As Docdan50 stated, clipping, or the amp has reached maximum power output. An extremely quick blink that rarely happens is probably OK, however, the longer it stays on, the greater the chance for damage to happen, especially to the speaker. Sorry, but you will just need to turn the volume down slightly.

What speakers are you using?

I had one of those 'Naks years ago...and getting the clipping light to come on (300 watts pre side) meant things had become VERY loud, so if that's not the case then I'd get it checked out if possible.