What is this for?

Distraction, vision, arson

Spells like this make me wish non-damaging cantrips also scales up with player level. 

Technically being able to possibly cover an 80ft square area in dim light is nice for a fight. Not so great for exploration as dim light still imposes disadvantage. But it being a  concentration spell means that in many cases you probably have more important uses for your concentration in a fight.

If the humanoid version of the orb glowed in a 20/20 radius of bright and dim light that would be sensible but instead the spell has no brightness difference for putting them in one space.

I would consider adding additional orbs of light as the level increases and having the humanoid forms brightness increase to reflect it. So maybe at 1st level its unchanged but add say 5ft of bright light to the humanoid form. Then at 5th its 5 orbs and humanoid form glows at a radius of 10/20ft bright/dim. Level 11 upping that six orbs and to 15/30 humanoid anx 17th pushing it to 7  and a humanoid form of 20/40 perhaps

Combat cantrips level up to reflect the mages total strength and how familar they are with that spell. But other cantrips do not. So a level 20 grand archmage's mage hand is not even slightly superior to a level 1 novice wizard. Or even a magic initiate. But their fire bolt cantrips are leagues apart

The penalty for dim light only applys to the round eared types with darkvision dim light is bright light

Would torch lights created by this spell be viable targets for Thaumaturgy? If so, you could pull some fun shenanigans by having a color-changing light ghost running around shaking the ground and whispering to people.

Does this mean you can't move the humanoid light since it will not be within 20ft of another light created with this spell?

Also if a second player also casts this spell, does that count for the 20ft limitation? Could 2 players perform a show for example by having two glowing humanoids dance around eachother?

I am interested in knowing the same thing

Why is the duration a minute long and have concentration, while Light is a hour long and allows you to cast other spells with no penalties?  What is the point of having this spell if there is a better spell to have.

Light needs to be cast ON an object with a range of touch, and can be covered up with a simple wooden bowl. This allows you to see something 120ft away and light up 4 separate areas at range.

Plus with Dancing Lights you can create a humanoid looking figure, which you can use to provide a distraction.

People need to stop comparing this spell to light, because that's not what it is for. Light is designed to provide bright light, and is a must for just about any caster without darkvision. In comparison, dancing lights provides dim light. You know what benefits from dim light? Creatures with darkvision, because they can see in it with no penalty. This is the equivalent of light for casters with darkvision, and is almsot as important for those casters.

Plus of course, there's the fact that you can move the lights about, and create a glowing humanoid figure. This spell isn't for creating bright light, it's for creating dim light and distractions.

Casting Spellwords are:

Invictus Flexibilitus

good lord... arson. my mind didnt even go there when i read its description. i guess my DM cap needs a few more feathers in it.

we used it to help convince a bunch of mer-people that one of our party members was a god

RAW arson also isn't even an option. They're lights, not flames. If it was possible to light something on fire with this spell it would specifically state so as any other spell does aswell. It'd also, you know, deal fire damage when touched and all that. But there's still more than enough cantrips for your pyromancer! 

Quote from Killer5362 >>

Distraction, vision, arson

 Why Arson?

no arson, no fire

Glowing Orbs is an option, huh? The FR wiki specifically says that these lights can resemble will-o-wisps. Since this is one of the few spells that Green Hags get, I'm going to try to get some mileage out of it. Imagine you are in a dark forest. A hag disguised as a damsel in distress or as a child appears. Four globes radiating dim light follow her. She screams in common, "Look out for the will-o-wisps!" Of course, any PC who has this cantrip (they never choose it) stands a good chance of recognizing the spell for what it is. I would even allow an Arcana roll. No Active Perception though because they already get that for free (meaning no action required and no resource used) to see through the hag's illusion. The goal here is to distract the PCs long enough for the hag to spring her trap.

I think the unspoken strength of this spell is it heavily implies you move all four lights, independently, at the same time. (The only limitation being they can't go too far from each other.)

So if you're up to some kind of illusion/trickery/performance, you can have each light doing wildly different things, simultaneously. E.g.: Light 1 circles a singer, Light 2 + 3 bounce up and down to the music's rhythm like they're dancing, and Light 4 bounces from person to person in the audience--all for one bonus action.

It says "you can move the lightS," plural, so in one 6-second round you have 60 ft. of movement for four different lights. You could scare, confuse, dazzle. It's one of those fun roleplay cantrips that has infinite possibilities, so long as you vibe with the personality of the spell. 

Quote from Killer5362 >>

Distraction, vision, arson

 How would this cause arson?  It says, "making them appear as torches."  So no, you can't commit arson, as these lights won't set anything on fire.  The torch appearance is merely an illusion.