I have seen way too many dolly lights not working. They are easily hidden by the towed, get the **** bounced out of them due to the fender mount, fenders and light damaged by turning too sharp, wires come disconnected and corroded. I feel that the further to the rear the light are the better the safety. I hate coming up on someone then guessing what their intention is only to find out the signal was blinking or the brake lights on but blocked from my view.
I use a dolly and the time I took to rig my lights was minor and well worth the safety. My only wish is that I would have spent the money for a set of LED magnetic mounts.
But it is legal.