Air has not BT modul. Blue light indicates docked device. Red dim LED means sleep mode and docking the device should wake it up= going blue. HW Reset would be good to start with...
On mine Air it is and easy slide off-on procedure. Just there is hidden a small button to press on the back of the cover, under the cloth, you wont see, but can be felt by finger...press and slide off the whole cover, sliding back is the opposite of removal. The cover is a part Nr: ZG04693, same for both sides, price cca 25 euro each.