The light on means that it is working - connecting both banks. From the ACR manual:
Features
• Automatically combines batteries during charging, isolates batteries when discharging and when
starting engines
• Allows temporary isolation of house loads from
engine circuit during
engine cranking to protect
sensitive electronics—starting isolation indicated
by blinking LED
• Supports high-output alternators up to 120 Amps
• Ignition protected-safe for
installation aboard
gasoline powered boats
• Under voltage lockout will not close when the
lower battery is below 10.8V @ 12V operation or 21.6V @ 24V operation—lockout indicated by
blinking LED
• Built in LED light indicates when batteries
are combined
Is the starting battery above 10.8 volts (at rest - turn
charger off and wait 10-15 minutes before measuring voltage)?
Use the bluesea diagnostic flowchart to find out whats going on. I had one go bad, they have lifetime warranty I had mine replaced by Bluesea. LED light tells you when the ACR is combining (not open). Also keep in mind that there is a delay from both the
charger and ACR which could be as much as 5 minutes before you see any
current flowing/equal battery voltage.