I believe the rider with the hand up was just pitting in on his own. I saw no red flags at the 2 stations before the carousel. It looked like the red flag just came out at the carousel station just as the riders were in the turn. The front rider seemed to check up without signaling.
Still ride street whenever possible but do not ride sport bike on street and have no desire to go fast on street. I treat it like a video game where you are assuming everybody is going to pull out in front of you or do something stupid. Still enjoy it as much as ever.
Just remember you have 2 days and pit in or set out a session if you start getting tired. You will feel much better the second day once you get started. Relax and have a blast!