I'd expect that if you had the HIDs, but the US 2006 package #3 HF doesn't have HIDs...
There are headlight adjustment instructions in the Owner's Manual for up/down.
My US 2004 BC with HIDs has that light up everything problem (with low-beams), and are very bright. Most cars will flash us... We've asked the dealer to check, but the height is supposedly within the state headlight beam limits, so no adjustment has been done.
We just sorta gave up on it. But you may want to either try a different dealer, or a local mechanic (especially if they do state safety inspections). Have them do a headlight beam alignment, make sure that they're not set too high, and if they adjust them down that they don't go below the state required level.
http://autos.groups.yahoo.com/group/toy ... 004-06.zip
US TSB EL004-06
April 28, 2006. Automatic Headlight Leveling System Warning Light "ON" or Flashing. 2004-2005 Prius w/HID headlights. replace rear vehicle height control sensor with improved one.
The TSB so far is only for 2004-2005 Prius only with HIDs, since they're the only ones with the automatic headlight leveling system. I'd assume that it was fixed for 2006, as the TSB hasn't been updated to include that year so far. The problem would usually manifest itself with the headlights being aimed far too low (people have reported that the fog lights were actually useful in these situations!), usually only a couple of feet in front of the car, and the headlight warning indicator on the MFD. sadly this doesn't usually store a code, and you'd have to get it to a dealer in this condition to get them to believe you and fix it...