jeffd:
Ah ha! After a little digging, I've found this:When you upload a sketch, you're using the Arduino bootloader, a small program that has been loaded on to the microcontroller on your board. It allows you to upload code without using any additional hardware. The bootloader is active for a few seconds when the board resets; then it starts whichever sketch was most recently uploaded to the microcontroller. The bootloader will blink the on-board (pin 13) LED when it starts (i.e. when the board resets).
That explains the pulsing LED in the beginning. Im still not sure how to ditch the bootloader though...
If you program it with another arduino or similar ISP based programmer there is no bootloader thus no blinking. The downside is you will have to continue to use them until you put the boot loader back with one. If you do not have or do not want to use another arduio a standalone programmer is a few bucks on ebay. Personally I use a hacked version of the ebay one to also give me ttl serial have yet to find anybody selling those.