This could be to old for those posting above but I had found these instructions back in 2004 and it worked for me when this happens to me on my epson 860:
1. turn off the machine for at least 5 minutes and disconnect the interface cable to the computer
2. push and hold down the "ink" button and the "paper" button and turn the printer on.
3. When the "paper" light flashes quickly release both the buttons and then immediately press and hold down the "ink" button only for at least 10 seconds.
You will need to try this several times to get the sequence correctly.
Flashing EPSON 860 Error
