The only time the lights matter, is when you can't actually see the boat. Therefore, there is no way to know if the light is at deck level or not. Deck level varies between 2 feet and 100ft, depending on vessel. Not to mention, tri-color lights sit atop masts that can push 80ft before the boat's LOA makes them impermissible. Ultimately, there is simply no height restriction, so any skipper inferring data from height is explicitly wrong.
In the end, using light identification alone is a pretty risky way to navigate around a moving vessel at night. This antiquated approach was better than running dark at the time, but it's primitive. Lights burn out. Light are obscured by waves or patchy fog. There are so many light configurations, no one can recall them all from memory.
If I see any lights, of any kind, I immediately identify the vessel on radar and map it's movement. I don't give a damn what lights I see. AIS is even better technology, just not fully adopted.
Honestly, no boat should be permitted to operate at night, outside a lit harbor, without some active, modern form of collision avoidance, other than deck lighting. Lights are like using leaches to cure heart disease.
This really isn’t a thread about wether or not lights should be used, whether they are antiquated, whether there are better methods of identification.
The rules are written in the most common denomination which every vessel should us from a dinghy to and aircraft carrier. The rules were made to make things safe. Because of that they assume all vessels follow them.
You can turn the original OP discussion into a drift on how/ whether vessels should be required to use them, but currently it is the law.
The OP asked about stern positioning. The rules are stated about stern lights.
If you think that placing them on top of a mast will serve to confuse ANY vessel ( dinghy or sir craft carrier) then it would not be a place to put it. If you think it wouldn’t be seen by all boats, then it isn’t the place for it.
On Haleakula the davits with dinghy impeded the original lights from being seen, therefore we had to move it. The best placement for us was the radar pole where it was seen by ALL vessels. There is no ambiguity when approaching Haleakula from beside/ behind that we have a stern light visible.
Not knowing whether you already have a masthead light on the main I can not give you better info. The only thing is don’t confuse anyone.