[Arran]

The light is there to let you know that the set was still turned on if the door over the dial and controls was closed, I had a Canadian G.E radio-phono unit that had something similar as it had a door over the dial as well. As for that bat switch, I think you are right, the power switch on many 1942 Philcos was included in the pushbutton bank and they sometimes break or become flaky, be thankful that they didn't drill an extra hole in the side or the front to install it. I think that Ron posted an article about how to repair those switches on a 1942 "sled" model he restored, he got a replacement switch from Lowes at the time (U.S Lowes of course the Canadian version probably doesn't have it).
Regards
Arran