Death is located in hell. You have to meet him in the evil story route to unlock the final dungeon, as the bard doesn't want anything to do with you, but the only way to meet him otherwise is to kill the Flame Tyrant, I think it is called, in the volcano instead of giving it the Ice Sword then heading down the staircase behind it. It's actually a pretty neat location and you can see the ghosts of various people who have died during the game down there, including ones you've killed. Pretty sure Galahad ends up down there if you decide to shank him instead of just letting him come with you. < . <;
You didn't let Saruin have the super sweet Obsidian Sword? D: Did you at least bring his clearly and unsubtley evil henchghost with you through the dungeon?
Normally speaking Light Magic is sold in the westernmost temple in Melville, I think it is called -- the empire capital, and should no longer be available for purchase after the empire is invaded by pirates, however the fan translation DID fix some bugs and that may have been one of them, so I'd check there. If she isn't in there when you check you might need to take the secret staircase down in there and clear the boss in the basement or find her in the emperor's room; if neither of those work, then Light Magic is locked for the remainder of the game.
I believe you need the map to enter the temple, I normally put off recruiting Hawke until he buys it for me, ala Galahad and the Ice Sword, and then recruit him, but you also need two talismans to get in, one from the great tree in the forest Claudia is from and the other in the shady temple in Northern Estamir from the priest who refuses to speak to you. Problem is, I don't know if those two talismans are still available, the forest one in particular, since you need to tell the tree you want to save the emperor for it and might not have the option any longer if he isn't sick. If you CAN get into that temple, though, it is a great place to farm up money -- it's where I always do it late game, since it is reusable, has a ton of enemies (like everywhere else), and the exit is easy to reach.
Just a side note, two of the game's 'end game' swords are also incomplete, one being the final sword for the evil route and the other being, as I recall anyway, the Obsidian Sword. Both weapons hit hard but only learn a single tech that costs an obscene amount of WP for the damage it does, so if you learn something like sword rain and nothing else that's what is going on there. The Ice Sword might be back in the shop for purchase, though I forget exactly what triggers that.