Per pixel lighting is the best method for lighting.
What you do is go through each poly in the scene, map it as you would if it were a lightmapper, only for each texel you've got mapped into u,v space, get the normalized vector from it's world space position into the centre of the surface.
flip this vector, and paint it as a dot3 compatible normal into the lightmap.
Now, when you move your light you get some absolutely awesome glowing per-pixel lights.
What you do is go through each poly in the scene, map it as you would if it were a lightmapper, only for each texel you've got mapped into u,v space, get the normalized vector from it's world space position into the centre of the surface.
flip this vector, and paint it as a dot3 compatible normal into the lightmap.
Now, when you move your light you get some absolutely awesome glowing per-pixel lights.