Revealing mistake: When Natalie is in the old building and she is looking around, she opens the door and Parker's dead body falls out onto the floor. When it cuts to a close up of his body, you can clearly see the side of his neck pulsating although he is dead. (01:19:50)
Revealing mistake: In the chase sequence, we get a shot of who is supposed to be "Brenda" driving, but we see the eye of a man, not a woman. Brenda doesn't have bushy eyebrows, and her eyes are a different shade of blue. (01:20:05 - 01:24:20)
Revealing mistake: When the killer calls Parker, when we see the phone it's not showing details from caller ID, it's just showing the address book.
Revealing mistake: When Natalie discovers Tosh's body, a close up shows Tosh visibly blink her eyes.
Answer: This urban legend involves wannabe gang-bangers being required to make a kill to join the gang. In this scenario they drive with their headlights off and kill the driver of the first car that flashes their headlights at them. This was proved to be a false urban legend by snopes.com where more information can be found at http://www.snopes.com/horrors/madmen/lightsout.asp.
OneHappyHusky