As a note the ARBS is the computing power and sensor fusion that generates the solution for bombing, in general it takes inputs from the INS and the DMT. The DMT is what actually locks things up and tracks them (well in theory vs practice in game right now).
As noted the DMT real world uses the INS to attempt to stabilize on what it thinks is the correct spot in the real world based on some math and the INS belief of where the aircraft is when that point is selected. The ARBS will take whatever you tell it is the target point and calculate a solution for it. The real ARBS actually allows for a simple hand off from the co’ords in the nav system to the ARBS as the target point, bombing off the map if you will.
Also you can use the DMT at night, it just takes fires or flares to get enough light. Flares are of course bugged right now, but I’ve actually managed to use the DMT if there’s enough stuff on fire in close proximity to create some lighting.
Also you could locate a target on FLIR, designate it via INS (put the flight path marker on it), and then drop on it that way. Additionally the real world functionality exists to simply punch in a set of coords and go drop. Apparently in OIF/OEF the Harrier at one point was one of only two NATO aircraft cleared to drop munitions in the tac support role purely on map coordinates (ie no lasing, or eyes on, just literally from the ATO, go drop a pair of MK82’s on the following grid, troops in contact). This is referenced a couple times in Harrier II: Validating V/STOL by Lon Nordeen. Good book, I highly recommend it for a look at how the Harrier developed for the USMC.