I have been to the light about 5-8 times and have seen the same general occurrences that many others have been describing on this board.
However, there was one particular incident that seemed to prove the car light theory true. One evening I was with my mom and brother viewing the light from the usual location atop the hill. The light wasn't doing anything different beyond it's typical slight swinging and changing of colors. Out of nowhere, a flashing police light appeared in the exact spot where the mystery light hung over the trees. The flashing, red and blue police lights literally overpowered whatever light had been there before. It was very, very clear that this new light belonged to a police car, yet it had taken the place of the Paulding light. If an obviously man-made light source can so easily be viewed at the exact same spot as the Paulding light, it seems that the car light theory isn't so far fetched.
Despite this more recent, obvious evidence, my mother has another story from her youth that seems to debunk the car light theory. My then-teenage mother went with my grandmother and some friends to view the light at night. After doing its usual swinging and changing colors, the light actually came right up to the windshield of their car. My mother said that from what she could see, it was nothing more than a light. There wasn't anything or anyone attached to it. It swung back and forth and as it did, it changed from green to red. It came straight down the hill and stopped just before it reached their car. My mom remembers seeing the shadow it cast on the hood of the car. My grandmother turned the car around before the light had a chance to do anything else, but the group remained there long to get a good look at the light.
My mother's story comes from a time before there were groups of people watching the light nightly. When she saw the light up close my grandmother's car was the only vehicle around. I find this to be pretty consistent with the paranormal. Most ghost sightings and other paranormal activity only occurs in the presence of a few people.