Only tested it briefly, so I don't know all about it.
Basically, you add as many lights as you want in your scene (the more lights the longer your export times will be). If you want those lights to also light up avatars, don't forget to set them as Plasma object.
Objects which should receive light should have "Shadeless" UNticked in their material boxes. You'll also need to add a "Bake Lighting" modifier to them.
By default, this modifier bakes to a lightmap (a texture which contains only the color of received light). This usually yields very good quality lighting, but also takes AGES to export - you want to make sure you keep the "Quality" dropdown to something low (this is actually the texture's resolution).
It's also possible (and often preferable since it's extremely fast) to bake to vertex colors, but vertex color lighting can look rather ugly on objects like walls and such (all objects with long faces, hard edges, and such).
(To sum up: terrains and smooth meshes should bake to vertex colors, flat objects with sharp edges like walls should bake to lightmaps if you can spare the extra export time.)
Performance wise, both baking options yield near-similar performances once in-game, although textures will take slightly more graphic memory. Nowadays it's rather negligible though. But lightmaps take a lot of time to export.
It's also possible when exporting to disable baking to lightmaps (light will instead be baked to vertex colors). This is extremely useful when debugging some logic, because you usually don't care about the lighting quality.
You can preview what your scene will look like by putting a camera in your scene and pressing F12 to create a render.
Advanced stuff, not for the faint of heart: Korman internally uses Blender's renderer to bake lightmaps, but Korman DOES hide a few panels in the World tab that have an effect on lighting (like Environment/Indirect lighting). So sometime you can switch to Blender's renderer and tweak some world settings there, which will affect the Korman export. However keep in mind Blender's lighting is a complex beast, and things like Indirect lighting, while awesome, are extremely hard to tweak.
(While I'm at it, a question for Korman devs: how feasible would it be to reuse previously-baked lightmaps when re-exporting ? This would look better than baking to vertex colors, and wouldn't require baking all the lightmaps again. Not a critical feature, but might be useful.)
Here is a picture of my test Age. It uses indirect lighting and emissive materials. Dezoom the page if you can't see it completely:
- Show Spoiler
(Also, I have ReShade on top of it, which explains the "glow" around objects)
To give you an idea of how tricky it can be: I originally wanted the Age to be daytime, but couldn't for the life of me configure IL to look correctly, so had to remove the directional light and rely on object emission only.
Also, I'm still not sure if there is an option to export lightmaps uncompressed. On textureless surfaces the compression artifacts are really visible... But then you're not supposed to have textureless objects either :shrug:
