Each light can have either a position or a direction. Lights with a position are often called positional lights or point lights. directional lights on the other hand are infinitley far away, they have no position. There are no true direcitonal lights in nature, since nothing is infinitley far away. But some light sources are so far away they can be treated as directional lights (like the sun).
So why use a direcitonal light instead of a really big point light (like how the sun actually works)? Performance. Directional lights are (marginally) cheaper than spot lights. Admitedly, on modern hardware this is no longer a problem.
You can set a lights position by passing LightParameter.Position to the GL.Light function. The function will then take a 4 element array of floats (x, y, z, w) representing either the lights position or direction. The w component is used to indicate if the vector passed in is a position or a direction vector. A w of 0 is directional, a w of 1 is positional.
Here is how you could set the direciton of a light
// direction must be normalized
float[] lightDir = { 0.5f, 0.5f, 0.0f, 0.0f};
// We pass in a direciton vector, this is going to be a directional light
GL.Light(LightName.Light0, LightParamater.Position, lightDir);
If i wanted to set up a positional or point light
float[] lightDir = { 2.5f, 3.5f, 7.0f, 1.0f};
// We pass in a position vector, this is going to be a point light
GL.Light(LightName.Light0, LightParamater.Position, lightDir);
The default position for all lights is (0, 0, 1, 0), it is directional, pointing down the negtive Z axis.
IMPORTANT: Whenever you make a call to GL.Light with LightParamater.Position the vector you specify is transformed by the current modelview matrix, just as vertices are, and stored in eye coordinates. We will discuss this in more detail later.