Hi all.
Thanks for the responses! I tried hard resetting it but it didn't help. I tried covering the light sensor as well, no luck with that. I (after a long frustrating struggle) rolled the phone back to 8.1 and the key lights worked perfectly again.
I installed Windows 10 mobile preview again and still had no issues with the lights. Various other problems I'd been having (blank Glance menu, screen flicker etc) disappeared as well.
Seems rolling back occasionally is needed to get rid of bugs that build up. The phone runs wonderfully now and W10 mobile seems great. Still a frustrating lack of apps though. Doesn't seem to be much difference from 8.1.
Anyhow, thanks again for the ideas!