I own 2002 Audi A6 2.7T Quattro. My brake light recently came on and flashed 3 or 4 times while beeping. The brakes felt normal and the car drove seemingly fine, but when I got home 2 minutes later I popped the hood and there was smoke coming from the section of the engine pictured. I thought it may be related to just washing the car but it continued smoking/steaming for minutes on end before stopping, and continues to do so when I drive later (although it's only noticeable when opening the hood). I have checked the brake fluid and it is full, and I'm not sure what it could be. Any help is appreciated.

 

The circled area is due to the valve cover seals leaking onto the exhaust manifold on that side of the engine. This doesn't mean stop driving the car, but you must keep an eye on the oil level. I recommend checking it once a week.

Look to have the valve covers and associated gaskets replaced within the next 6 months or so.

The brake light might be several different reasons ranging from a failing abs wheel speed sensor to a loose connection providing that the brake light eventually turned back off.

I would begin by inspecting the wiring in both front wheel wells and see if any wires are frayed and then from there look at the actual condition of the speed sensors.