Tom:
"What did they mean?"
Just an easy visual reference that the machine was within the wash cycle. You didn't have to be close enough with good enough eyesight to read the wording, because the dotted area was unique. Blue without dots meant Rinse, and red meant Drying.
P.S.: Am I the only one who noticed GE's thriftiness with the two ads shown? That's the same model in both, wearing the same heels and pearls in both, and the same dress in both, just in two different colors.