Cooling System Problem

What is your question?

In my 2005 Beetle, the coolant light beeped and came on, by the time I exited the highway the light went out. When I checked all my fluid levels they were exactly where they should be. When taking it to the dealership for driver's headlight repair(the light burned out the very same day) they say I had a Cooling System malfunction and want $688 for the repair. If the blue light came on, is this some sort of sensor that just triggers at a certain mileage to try and get you to make unnecessary repairs? My car only has 35,000 miles on it. I am not happy with Volkswagen right now.