I've seen this too, actually - both on my shuttle and a friend's one. The switch is working fine, it's just the PSU seems to have a crisis - just when you think it's toast, it comes on and works fine as if nothing was up.

Not really looked into it much as, well, it works (and my shuttle is my single permanently-on box, doing my Skype USB phone & X10 control amongst other things)

Hugo