After a recent discussion with DancePowderer in his recent blog about epithets he mentioned "Red Flag" X. Drake as an example for a vague epithet so I decided to do a little research to see if I can't make sense of it and I came up with a couple of things:
1. This flag was and is flown by British merchants and civilians. The reason to mention this here is that X. Drake's namesake, Sir Francis Drake was a British privateer which means that he most likely flew under this flag which is, for 75% red. I imagine X. Drake's flag might look similar or maybe Oda just looked up some nautical terms.
2. In the system of international maritime signal flags, this flag stands for "Dangerous cargo" or just simply "Danger". Red flags in general are seen as a measure of warning and danger, and, seeing that Pirate flags used to serve that function too, I can see Drake hissing this flag, maybe he's not ready to his a Jolly Roger yet as an ex-marine and all who knows. (Hmm I wanted to upload another picture...didn't work for some reason...anyway hyperlink will do)
3. Some other pirates have already used a "red flag" for example here is Edward Every's flag, a pretty typical jolly roger design, safe for the red background.
Anyways, just my thoughts on why X. Drake could have the epithet Red Flag. Feel free to add what you think.