if I place a light outside a window, will this stop people from seeing in through the window or make it even more visible?

You will be visible if the light level in the room is higher than the ambient light level outside. An external light would not make much difference.

It has to be darker inside than it is outside.

You could test your space by dangling a lit lamp from your upper window. With a light on inside, go outside and see if you would have privacy.

An easier and much less expensive way (not adding to your electric bill) is to maintain night time window privacy by way of a curtain, piece of fabric or even a towel over a tension rod.

It will have very little impact if the window it is outside of, is also lit up.  At night, if a light is on in a room, one is very visible from the outside. The only way to change that is to physically block the window.

It will reflect on the glass, making it hard to see in  and difficult to see out. A light on the inside of the window will have a similar effect.

glass is glass. 2 way visibility.  Try drapes. or really long curtains.

Put a light near the outside of the window and set up a hose that will release some water in their face when they  get close enough to peek inside.

It will reflect on the glass, making it hard to see in  and difficult to see out. A light on the inside of the window will have a similar effect.