All dash warning lights come on and the temperature and tach needles drop to zero when the headlights are turned on.

I would say its probably a short or a ground problem at the turn switch or a wire in that area. you need a test light and probably a multi meater and some nohow a ground or wireing problem can even drive a master teck crasy.

Dynamo belt broken?

The ground checks out? Which ground did you test?

did you try turning the dial just to the right of the steering column on the dash? Just askin.

I have had the almost same problem twice. A 'thump', like the engine missed a fire and tach drops. Seems OK after restart. Electrical? Timing chain slip?
Has 135,000 mile. Any clues?

Sounds like a bad ground to the dash lights.

I'm no expert, I recently purchased a 2003 vibe. I noticed the automatic headlight's sensors can be super-sensitive, about an hour hours before dusk they'll kick my headlights on (when the sun is still shining!), or sometimes when I go into an underpass, and then sometimes they'll realize it's light enough and turn themselves off. This would cause your dash lights to go to the 'headlights on' mode and turn the headlamp signal on, the intensity is controlled by the dimmer/dome light control on the left side of the dash. Check to see if the dimmer is down too far, as this could cause the lights to dim when the automatic headlights turn on. It's also possible that the dimmer is not working, thus no power is getting to the dash lights through the dimmer. Try testing it by starting the car in daylight, then manually turn on the headlights, then adjust the dimmer. Like I say, I'm no expert, just guessing because I've noticed it happen similarly on my Vibe, but my dimmer was at half-way, as I like it for night driving. Someday, I'd like to disable the automatic sensors and DRL.

sounds like a computer problem have the car scanned

Turn on your headlights and check to see if your taillights are working. They act as a fuse to your dashlights, its a safety thing

sounds like the computer has a glitch. you might need to go to the dealer to have the computer trained(reprogrammed) or to see if you need a new one.