Is there a way to create volume lighting. Light emitting in all directions instead of spotlights. For example, a flame, or lantern.

Not from within Poser there isn't. You have spotlights (rays in a cone) and distant lights (rays parallel and hit everything) but NO point lights (rays in a sphere from source). Volume lighting where you "see" the rays as if in smoke, can't be done that I know of from within poser. You can either light and render in another program. Byrce, or RDD,( or something heavywieght like 3DS Max), or you can fake it with several spots. Keep in mind that in film lighting (real life) the sources in shot are rarely lighting the subjects which are lit by spots out of frame. Maybe someday Curious Labs will make a more robust rendering studio (I'd like the rendering and filters of RDD with the ease of Poser myself) and a spot render tool so you don't have to render complete frames to check something. (Hint ,hint ;-)

Thanks for response. I really like raydream and the poser3 plugin. I wish they had continued that. Well, I will keep looking. perhaps the Lightwave plugin would wor hmmmm