cat has a bulletin out on this code
first thing they say to check before you go deep into diagnosis is the sparkplugs, if they are worn and do not fire correctly it can trigger this code.
They also say to check the coil packs, wiring associated with them also.

What happens when the plug gap gets wide or a coil pack fails the ecm tries to compensate the difference and causes the other components such as pos and phase sensors to go out of range. This is where the ecm thinks its a sensor issue... due to the inability to compensate.

Of course they go into alot of other scenario's that can create this code but those are the 2 most common issues that trigger an e-27.
As for all the dash lights flashing? kevin is correct, when the code hardsets in the ecm memory it goes into limp mode and hardsets the code. Only way it can be removed is through the clear cmd via the laptop program or possibly the 'pedal dance'.
Remember though, the pedal dance will not clear all codes, some of them have to be cleared with the diagnozer program.