What's going on when you hit your head and you see lights?!

What's going on when you hit your head and you see lights?

Good question Bubba.
The importance of "seeing lights" or "seeing stars" ,as some people frase it, is a fair indication that you have had a severe enough impact to cause a "concussion".

We have come to learn that these are not single or isolated injuries but actually have an escalating effect: Each following concussion or blow have a greater likely hood of a more severe and lasting brain injury.

Steve Young of the S.F. 49'ers ( a very smart guy ) who had to give up his promising career due to a number of successive concussions.

Although "vision" is a very complex neurological process, involving several parts of the brain, it is thought that the vision centers located in the back surface of the brain (visual cortex) is responsible for thees "flashes" of light.
Even though the "impact" may not be directly upon the back of the head, if the impact is severe enough, the brain will , literally bounce inside the skull, striking the back against the skull even though the impact is in the front of the skull: This is referred to as "counter coupe"
Because the brain is surrounded in a fluid filled capsule ("meninges") filled with cerebral spinal fluid (C.S.F.) and because the brain is slightly compressible,this physical possibility, is fairly common.

I hope that this answers your question: Watch dancing with the stars, instead.