Dear snp,
Thank you for your kind comment.
I have had a read of your essay:
An interesting idea. I also think that the Universe can be modeled using linear equations based on Galilean principles. You might be interested to read my 2012 FQXi essay titled "A Classical Reconstruction of Relativity".
The creation of Matter by light passing close to atomic nuclei is known to occur - pair production - but this is due to the strong electric field around, for example, a lead nucleus. Likewise electrons and positrons can mutually anihilate to produce gamma rays (light). There is a balance between both these types of events.
I think you have 'Red shifted' and 'Blue shifted' around the wrong way in you equations 32 and 33. A higher frequency would be a blue shift and a lower frequency would be a red shift.
Regards,
Declan