Agree. 

The rules are clear defining "When": at starting signal.
On I flag, the RC committee has to react also on boats over the extensions.

Walter .. "The rules are clear ..."

Not so fast .. John's got a point.  Here is 29.1 separated to make John's question  clearer. 

The above can be easily read in such a way that as soon as ("when") a boat must comply with 30.1, the RC shall signal.  

The way we customarily read 29.1 is as if it it said ... 

.. but that's not what's written. 

Nick ... I'm not being contrary just for the sake of it.  It's a genuine observation (of John's point). 

In the original 29.1, there is only 1 "or" and only 1 comma. 

That one comma makes everything before it one phrase.  The "or" is in the middle of that phrase. 

The first phrase sets 2 test conditions separated by the "or".   "or" works such that if either condition is true .. the statement is true (this is the same Boolean logic issue that screwed-up 3rd party protests in the current quad).

A boat must comply with 30.1 anytime in the last min they are OCS.  That makes the "or-statement" true .. and that triggers the action in the 2nd 1/2 of 29.1 ("..the race committee shall promptly display flag X with one sound") because its timing is "when".  

It's simply not the clearest the way it's written.  Another option to make it clearer is.  

Leaving sailing and entering linguistics.
Keep it simple: What is the goal of X?

In race signals it is called "Individual recall" . Where is the meaning of the recall of a boat that (still) did not broke any rules? 

Why to display it differently on P or I?

So, change the wording if it is wrong. Patch the rules text. 

Disclaimer: not using I for years, just P,  U or black.

In P or I starts, there are usualy some/several boats over in the last minute. On I, usually behind the RC boat, waiting the last 20-30 sec to return back over the extension and start properly. No one broke the rules. 
You probably must, if you follow the rules on this way, bring up the X as you put down I.
Is this the meaning of X? 

An elegant response. Agree entirely. And with Walter Stemberger’s comment about not using I. No-one I know uses it hence my request to those who do to raise their hands. But not because I would need to be ceaselessly displaying and removing flags. It’s because it makes a mess of an otherwise sweetly set starting line. 

As a sailor of a small keelboat, I can tell: every single horn out of the sequence 5-4-1-Start can build a mess in the line: in the crowd, between sails and on starboard tack, you cannot see easily the flags, risking a collision.
 

A fair question. In High School sailing (which I coach) here on the West Coast of the US, we use the I flag frequently. It is usually written into the SIs as automatic after a general recall. 
You'll still see boats above the line at a minute (we'll generally hail them). They are not in a bad position, though, since they were intending to get out around one end or the other anyway. Putting up X-ray with a horn would be distracting and confusing. 
But in the final thirty seconds, the boats are generally set up a little farther from the line than without the I flag. It usually does make the fleet more well behaved. 
There are couple of important differences between the U and I flags, as I see it. First, under an I flag, being OCS at a minute is easily recoverable and may even be intentionally done as a way to get to the other end of the line in clear air and out of traffic. A U flag results in DSQ without hearing if you are OCS at a minute. In dinghy starts, a minute is a long time. 
But being OCS at 20 seconds is really going to screw you, while the other boats have no incentive to press the line. They know, especially if they hear your number called, that the fact you are bow out on them is not an issue. You will be out of their way and they are more content to hang back the proper distance from the line 

Right, as I explained above, to answer your question, X goes up at the start.