After consideration and thought on the comments on the post I made last week, I've decided on how to modify the Sunlight spell. For more modifications to spells for my DF game, see the Revised GURPS Magic for DF page.
As DFRPG Spells, p. 48, but with the following additional sentence at the end of the first paragraph.
"This spell must be cast on the terminus of the light - it cannot be cast in midair, over a gaping chasm, etc. to reach the bottom."
I think that takes care of the main issues we've run across with range penalties and how to cast the spell.