In confined waters, I too, have found it difficult to work out where the boat is at the bottom of the mast.  I suspect lights lower down are easier for most watchkeepers to identify.  I confess to leaving a cabin light on for that very reason, because I only have an all-round white light.  When I get some spare cash, I will consider buying the Navisafe lights for entering harbour, etc.

Extract from a letter in PBO November 2002 from a big ship Captain G Kullack who then ran navigation courses for yachties on [ferry bridges]:

"I've been the master of a north sea ferry for more than 40 years, mainly on a route between Germany and England... Part of the program is a ... session ... about problems between yachts and merchant shipping.... One of my most important points has always been to show ... the danger of masthead navigation lights... Boat owners think that... [such]... are more visible, because the difference in the range with the light at 10m compared to 1m with the height of eye at 14m (ship) is 14 nm instead of 10 nm. With the height of eyes at 6m (coaster) it's 11 nm instead of 7 nm, while the range of the light needs to be only 5 or 3 nm (respectively).

"On the other hand a masthead light, which is say the same height as the officer on watch on watch of of a merchant vessel will stay on the horizon independent of the distance, suggesting that it's actually further away. The low brightness only makes the situation worse.

"[Also] The light does not even necessarily change its bearing when it gets closer... Owners should never forget that a masthead light might not be picked up between all the lights along a coastline.

"Therefore my recommendation has always been put your lights at rail height, even if it means one more .... lamp (instead of three)."

Hi,

It is very simple, you make a mounting bracket, thin marine plywood. You Mount a bungeecord on one side, and a hook or whatever on the other. Adjust the length of the cord so it sits snugly on the mast. Then you take a running light lantern to you boats specification and Mount it on the bracket. Have an Electric wire to a deck contact. Youmay or may not have it on a seperate switch, and that is all there is to it. Let there be light! It is more difficult if you want to motorsail as the sail will get in the way of the lantern. You would need a "mast"(broom stick) in front of the sail to get it right. 

The "Lights" switch on my switch panel powers a "ON-OFF-ON" switch labeled "sail" and "motor". That way a flick of said switch turns off my stern light while turning on the 360° mast head light.

Marie G sports a steaming lantern mounted With bungee cord 1,5 meter up the mast when motoring. A deck contact is all needed, Connected to the normal navigation lights. When sailing, not needed, when motoring, sail is Down anyway.