Why does my lighting which looks so good in SP mode, look absolutely craptacular when in MP mode? I know usually MP cuts back on eye candy to improve performance, but the difference is so ugly. (I'll have screenshots up soon). Is there any way to improve it?

No because MP and SP load the map's lightmap differently. The quality of the lightmap for MP, if I ventured to guess, is compressed thus not as demanding on the video cards. Therefor, in the heat of battle in MP, the game runs slightly more smoothly as a opposed to SP where you take in the settings.

But don't take my explanation 100%; that's the most logical reason I can think of. The lightmap is a texture of sort (mapping the light), lower definition means higher framerate.