Could someone please tell me what's causing this, and/or how to fix it? Thank you!
This is caused because of how you're doing your region tiles. I had the same issue and it took forever to figure out.
If you want to use shadows for an area, you must region EVERY TILE. The way it checks shadows is to check what regions allow for light around it as well, and when there's no region to define height, things go weird. The empty areas where your lamps are MUST have region ID's assigned.
A light will only ever travel to other tilex with the same group
1-9 are grouped
10-19 are grouped
20-29 are grouped
30-39 are grouped
you get the point
Here's an example of my map:
You have to choose if you want light to hit the walls or not. If you choose yes (like I did below), some corners the light bends at weird spots but looks more realistic - but if you choose no you can have the walls and ceilings on matching for better shadows on corners but looking less realistic.
Okay so
One more important thing to note. I am not using the regions as they are originally intended either. The shadow system was designed based on a height map.
1-9 is first floor
10-19 is second floor
20-29 is third floor
etc
So basically you can have even more realistic and complex shadows if you read the help file and really understand how the shadow system works. I decided to have less complicated shadows to save on development time and follow a Roof/Floor system. Generally I try to separate the roof by one group, but in the example above I have them separated by two groups (because of pure lazyness and not paying attention lol)