The Merman's Children.
I summarized the merfolks' descent here. Anderson's text states that, when their bodies filled with water:
"...subtle humors decomposed the fluid element itself to get the stuff which sustains fish, fowl, flesh and fire alike..." (p. 53)
I summarized that as "subtle humors decompose water to extract oxygen." But, of course, the term "oxygen" was not known yet. What I also missed was the alliteration of fluid, fish, fowl, flesh and fire. Oxygen sustains the three kinds of life as well as fire. And, since we are dealing with "Faerie" beings, might there be a hint here of salamanders - living fires?
The undersea cold is described as "...lamprey chill." (ibid.) The decrease of light has three stages:
light "...like new leaves and old amber...";
Each Lirian "lanthorn" is:
a hollowed crystal globe;
in a shuttered carved bone box;
on one side, plated with varnished silver;
on the other, shaped into a lens;
filled with living seafire;
with a meshed hole to let in water and food for the animalcules.