@parrguy that's a heck of a mill you got there!
I will be very interested to see what you try here because I'm working on a layout that will feature blast furnaces. I also aim to animate tapping the furnace.
I planned on using individually addressable LED lights and something like hot glue to get the light diffused. The electroluminescent wire @Forty Rod suggested above looks very like they have potential but I don't know anything about them. I wanted to get individually addressable LEDs to be able to simulate the iron running along when the furnace is first tapped and the wire might not let me do that. We'll see. I'm still working on the structure at the moment anyway.