Nice find. It sounds like the wires for the lighting circuit were probably undersized as a cost saving without enough regard for the impact on the lights. The power loss for a given size of wire increases as the square of current.
P (watts) = I**2 x R (Amps squared times Resistance in ohms)
A slightly smaller wire will have a bit more resistance but will result in a much bigger power loss at higher currents. Now think what happens when the wire gets hot and the resistance increases even more....
