Would bad speed sensor cause overdrive blinking light?

Yes, a faulty speed sensor can cause the overdrive light to blink. The speed sensor provides information to the transmission control module about the vehicle's speed, and if it malfunctions, it can lead to erratic transmission behavior, including issues with overdrive engagement. When the transmission detects a problem, it may trigger the overdrive light to blink as a warning to the driver. It's important to diagnose and address the issue promptly to prevent further transmission damage.