This is another one of those questions where it is hard to guess, "why do it that way." A dual supply system (i.e., generator and mains) should have an isolation switch between them. Why not monitor that switch or whether the generator is running?
Alternatively, if there is a need to monitor at the outlet, I wonder whether a low-level, high-frequency signal could be injected at the generator or switch. That could easily be detected at outlets to give the "LED" signal the OP wants. In fact, the signal could be encoded to show when alternative power was switched on or any other important information.
John