There are some fantastic theories out there. The best one I''d ever seen was on a site, the URL of which I''ve sadly lost. It posited that the "light" was actually the gas used in Blasters, held in place by a forcefield - this explained colour differences (different types of gas, or tuned forcefields), why the blades can deflect Blaster bolts (they''re the same material, and opaque to each other) and why the "light" blades cast a shadow. This is, of course, just a fan theory.
At the start of the prequels, there''s peace, so more money and time can be spent on research and development. Then, during the Clone Wars and the Rebellion, less money could be spent, and things regressed a little. Also, because George Lucas shrugged and said "You know what, I''m richer than Croesus, so...what continuity?"
There was going to be a novel which basically said that in our future, humans escaping the world portrayed in THX 1138 travelled back in time and started the Star Wars galaxy. This should be taken with an extreme pinch of salt, though, as it was never published and should be considered as the same level of Canon as The Star Wars Christmas Special, and Luke/Han Slash Fiction.
Not everyone understands all the different languages. Not everyone speaks Shyriiwook, for example.
