Thanks to g_force_alt on the M5 board my problems are gone! He did a fantastic write up on disassembling the steering column to reach the optical disk in the SZL and cleaning. Took about 3 hours, 2.5 of which was disassembling for the first time and trying not to break anything.

My disk was covered in a sticky residue with a bunch of small hairs/dust, kind of like cottonwood stuff. Took three times of cleaning with windex and then drying and polishing with an eyeglasses cloth in order to get it clean.

Reassembly was SO much easier and boom, DSC and YELLOW brake light are gone. Saved me $780 for 3 hours of my time.

If anyone tries this and has issues please message me and I'll be glad to assist as there are a couple things I noticed from the write up that could be a little clearer.

Steering angle sensor DIY fix - it worked - BMW M5 Forum and M6 Forums

 

nice. i wonder what the gunk residue is from.

 

@turboawd - the M5 guys were theorizing that it as a combination of normal auto dust and the fact that the SZL sits in the steering column and is constantly baked in the sun. Maybe some residue of detailing stuff, etc. all I know is it was disgusting.