You're freaking out too much.
It is very natrual for fish to shy away from light, especially a juvinile oscar. Light to a fish means being out in the open where a predator may eat them. Sure, there might not be anything else in the tank, but nobody ever said fish are smart. Oscars especially come from a natrual history where their native waterways are overshadowed by trees and roots, giving them nice shady hiding places that make them feel secure. The light on also allows the fish to see more of the things that might scare it going on outside its tank, such as your face plastered against it<G>. Even just a stranger walking past the tank can scare an oscar.
The best ways to make your oscar feel more comfortable is to put a bit more decoration in the tank. Rocks that can be siliconed down are best, oscars do like to dig up and rework plants, even plastic ones, and move rocks. Make your decor size apporiate for your oscar so things won't crush him if he makes them fall.
Something else you might want to try are "dither" fish. Dither fish are small prey species placed in the tank with a large predatory one to bring the predator out more. The presence of tiny fish in the tank trick the oscar into thinking no bigger predators are about to gobble him up, so he'll come out more and enjoy a lovely chase. Good dither fish for oscars are tinfoil barbs, giant danio, pacu, congo tetras, buenos aires tetras, or silver dollars. These fish are fast enough to get away from a oscar's hungry mouth, but if some of them go chomp, don't be suprised. Of course, adding more fish depends upon your tank size and if your filter can support the added load.
A third way would be to condition your oscar to enjoy the light. Turn the light on, give your oscar a few moments to adjust, then feed him, or reward him in some other way. Almost all fish can be conditioned to expect food when their hood lamp goes on. Feeding your oscar in the light will make him bolder. Gradually he'll acclimate to having his light on.
Something to practice is to never turn your hood lamp on in a dark room. Always turn the room lamps on first and give your fish several minutes to adjust before you put the hood lamps on. A fish's eyes react the same way ours do to sudden light, and the sudden light can startle your fish into being afraid. Allowing the fish to adjust to slowly increasing light levels will help not to startle him and condtion him to fear the light. The reason his eyes look bigger in the dark...because his pupils have dialated more opened to allow him to see the same way ours do.
~~Colesea