Ahah, if it blinks slowly enough that you can count them, it must be running at 4 MHz instead of 16 MHz. You'll need to run the complete burn.bat script, or its equivalent with avrdude, in order to properly set the fuses on the ATmega8.
Okay I reprogrammed with fusebit settings...
avrdude -c bascom -p m8 -U lfuse:w:0xdf:m
It blinks faster on reset but "Programmer is not responding" message still comes up...