A friend of mine uses Lightwave extensively, and it seems to work pretty well to be honest. They don't use it for anything API-like, but the app—which, I grant you, isn't the best looking—seems to do the job. Other than that it seems quite a good solution for adding the smarts at the switch level, which I think is definitely the way forward.
There was a thing I found* a while ago about someone who'd managed to use PHP (!) to send the right flavour of UDP packets to their Lightwave hub, emulating what it gets from the app. I never had any luck with it at said friend's house, but you may have more success. And, as you mentioned, there's pauly's API which looks more promising.
Interested to know which solution you go with!