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Hello Peter,
You have a well constructed essay which should gain you high marks.
Since I endorse an Emission-theory model of light, there are very few contentions in your paper to which I can relate. An issue I would like to discuss relates to three of your comments in Act 1:
"Light would then travel at c= d/t through a background medium, but change to local c when meeting an observer."
"Extinction distances ('Ewald-Oseen' etc.) for the 'old' signal are commonly ~1 to 200nm< (also lambda dependant) but may be on < parsec scale in space."
"It may be hard to envisage light speed changing at all on entering a medium from a 'vacuum' yet it does so by Fresnel's Refractive Index n to c/n. Glass n = ~1.55 so light slows from ~300,000 to ~193,500k/sec. then accelerates by the same amount on leaving."
I like the Ewald-Oseen extinction modification to Emission theory which was added by J. G. Fox in [Fox_AmJPhys_v33n1(1965)1-17.pdf]. It explains how and why light always appears to travel at speed c, even from the proceeding and receding stars of a binary system. Based on your inclusion of the extinction concept, you apparently embrace it as well.
In the Emission theory, light is always emitted at c with respect to the emitter. It can be captured at c+v or c-v, but the v is extinguished upon re-emission.
I believe that refractive index as commonly described is an illusion; rather than a predictor of speed it is a predictor of how many extinction events will occur per unit thickness. When light enters glass from air, for example, it undergoes a huge number of extinction events, while maintaining speed c together with the entering wavelength and frequency as it travels from emitter to re-emitter.
Using Fox's formula for extinction distance, one can calculate that blue light undergoes approximately 13,000 extinction events while traveling through 1 cm of glass. If each event occurs in 1.4 femtoseconds then the cumulative time delay would be equivalent to light traveling at 193,500 km/sec without undergoing any extinction events. It is interesting to note that the oscillation period for blue light is approximately 1.4 femtoseconds (see http://en.wikipedia.org/wiki/Femtosecond).
It should be evident to anyone who has looked at the color of the sky while submerged under water and then again upon emerging: the sky is the same color blue in both cases. This indicates to me that wavelength and frequency do not change while passing through a dispersive medium. Frankly, I believe the model I have just described fits your DFM model better than the one you are using because I have light traveling at local c (in water or glass).
Additionally, there is no acceleration when light exits the glass. There is no alteration in the momentum or energy of the photon as it passes through the glass. The only time there is a change in frequency and/or wavelength is when there is relative motion between the emitter and re-emitter.
I was pleased to see that you left the door open in modeling light with the inclusion of the word 'photon'.
Good luck in the contest.
Tom Miles