I was going to make a new post about this when yours was suggested to me. I (think I) figured out what the issue is. Most objects in the game are "solid" when it comes to light sources. They create shadows, they don't allow lights to pass etc.

However, what ISN'T solid, are walls. The ones you create with the wall tool. So any floor, ceiling, or wall will just let light pass through it as if it's not there. You can easily test this yourself by building a wall, removing a single column and replacing it with a jungfrau cube. Place a light source behind it, and only the jungfrau piece of "wall" will cast a shadow. It's also the reason why, if you create a room with no windows, no doors, no openings whatsoever, you can still see clearly. Light passes through those walls and ceilings.

In the Woodland Hostel, light bleeds through the side of the A-frame.

I’ve noticed that the new fires are really bad about light bleeding through walls. ☹

I agree!! Also, If this game allowed proper mods someone else would have fixed this by now!!

I agree, there is a lot of bleeding light and no, I am not swearing!