You and me both =) I’m currently working on more advanced fog solution for smoke and clouds (and fog), most of my current success is coming from volume lighting like solutions. I want better light shafts so I’m working in that direction, still very early thought.
This smash lighting works offline by first lighting the mesh with a fake lighting rig (jme lights + extra area and hemi lighting) that is setup to mimic the world lighting. For my clouds, shadows are calculated using volumetic data, static mesh shadows are in the pipeline (they are scary since I don’t wan’t to ray-trace, I’m dubious about the accuracy of using a shadow cam like solution and area lights hurt my insides).
This lighting information is then blurred and warped - the core of the smash lighting - that gives a translucent like effect. It does not use any volume information, its works on the mesh level.
The new lighting information is written to the mesh, and the mesh is written back to the disk for later runtime use (an optional step). Finally this new lighting information is fed into the final material (Unshaded, Lighting, PRBLighting etc…) with a little tweaking, at runtime with next to no performance hit.
As for clouds specifically: the clouds I did a while back (which you are probably interested in, I can’t remember if I ever made a detailed post about them), I started by defining the cloud volumes (the shape of each ‘cloud’) using a density volume and skinning it with verts, (a voxel like approach, think Minecraft but with vertices rather than cubes), these cloud ‘meshes’ can, and were, modelled by hand in Blender at one point but it was taking too long to make large areas so I went for a more procedural approach. The cloud vertex points are then ‘smash lit’ as described above, then point sprites are rendered at each vertex in each ‘cloud’… so its just particle sprite based, big let down I know but I’m yet to find a more appropriate solution for close up / going inside type clouds. If I ever get around to patching the “rolling / spinning” issues (where the edges of the clouds look like a buzz saw while rolling the camera) they won’t look half bad.