Ok, you've already pinpointed the problem. The theft light blinking rapidly indicates a problem in the PATS system. It may be something as simple as reprograming the key, but it is something that has to be done by the dealer. When the light flashes like that, it is telling you that there is a problem with the system and it will shut down the ignition system and you cannot start the vehicle. There are a number of things involved in this system: the transciever that surrounds the key tumbler assembly, the Instrument Cluster with sends and recieves the signal to the transciever and the PCM which is instructed to activate or not, depending on what is happening in the system. You must have diagnostic equipment in order to see what is wrong with it.
I can't believe that the dealer your brother-in-law took it to didn 't see that right away. I don't think you are going to be able to fix this one yourself, because you don't have the tools to do the job. Maybe on the next one.
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