>I'm not seeing the issue. Obviously the energy can't be lost, or there would be no energy left in the universe.
>
>So it has to be dropped somewhere, probably to find its way back into a star, and then re-emitted as light at some point.

Energy finding its way back to anywhere is not too different from light - it's, IIRC, just infrared radiation, i.e. heat, and if light has a finite reach, so would heat do as well. If it undergoes a red shift along the way, well then it's the infrared going by lower and lower temperature (just as red is the coldest color of the visible ones). This would mean the energy is being dissipated in the space somewhere along the way. It must be, because if it (and light too) has a finite reach, the energy of that radiation (light, heat, any other EM) can't vanish, so it has to get absorbed into something.

Just not necessarily the stars - because, also, a finite reach light may be directed towards a star too far.