VW Golf 2.0 - struggled starting today, flashing engine light, BURNING smell

Fiance started her Golf today. Rough idle and FLASHING check engine
light. Strong burning smells, like burning oil. It's a 2002 with the
2.0 4-cyl with automatic.

Checked the oil - about a half quart low, filled it. Left it for three
hours.

Came back, started it again. Same thing - rough idle, flashing engine
light, strong burning smell.

Oil was fine.

Out of curiosity (and so I could get closer to the smell), I started it
a 3rd time. Idle was fine, engine light on steady but not flashing, no
more smell.

Any ideas? It has been raining a lot recently and is humid in the
garage. Car has been taken in for failed O2 sensor before which caused
a false engine light.

Thanks for any thoughts!