Thank you for this mod - it's a major realism improvement.
As far as I know, the merchantmen were under strict orders to use no lights except for a very dim stern light in foggy weather, to help keep ships in the rear columns from drifting out of station. Any merch captain who turned on a searchlight during an attack would probably be relieved of command - assuming he survived.
On one convoy a US Coast Guard cutter was begging a tanker crew to put their lights out. Finally, they trained their MG's on the tanker's portholes and offered to "put the lights out for them". They got the message in a hurry.
