You must place the camera inside an object to use the refraction effect I am talking about. The interior of the object will display refraction effects. External objects are obviously not affected because they are outside the refracting object. Try it. Make a large cube (say 200 units on all sides, with the bottom level with the ground plane) and place the camera inside it, about half way up-down. Put the camera at one end of the cube so you can see as much of the cube interior as possible. Pop in a spherical light. (so you can see what you are doing!) You can leave it at the default setting. Place it in the center of the cube. Put any object inside the cube so the camera can see it. I like the red sphere. Put it on the floor of the cube under the light so it is illuminated. Turn off atmospheric effects in the Sky Lab. Set the refraction for the CUBE's material to something higher than air (100). Render and see what it looks like. Try different refraction settings and see the results, also try ranged light falloffs (usually set about 80). Move the sphere into coreners and so on and watch how the refraction affects it. I use this technique all the time and it works fine.