At a certain distance away (don't actually know how far) the software starts to drop certain details (like icons, or tree detail) in the interests of efficient processing speed. In this case, high altitude will cause the explosions to not be rendered, while you can still see the building blow.
No bug, not lighting...just keeping the framerate undwer control.
The real bug is when you drop, and all your bombs simply disappear before they hit the ground. Now THATS a PIA...