The basic workflow of a lightwrap: duplicate the background, mask it, filter it, mask it again and comp it on top of the foreground element. Let's get to it.
Your new Lightwrap layer should be completely covering your previous composite, and your Layers List should look like this:

Because we want our lightwrap to effect the edges of our hand, and not completely obscure it, we'll go ahead and apply an Image Mask to the duplicate sunset image. We will use the hand as the source for the mask, and change the mask to be subtractive (the default is additive), which will cut the desired hole.
By default, Motion disables the source image when a mask is created, but we still want to see the hand image, so we re-enabled it. If you look at the preview thumbnail for the lightwrap sunset image in the Layers List, you will see the results of what we just did:

We have punched a hole in the image that is the exact size and position of our hand element, but since the mask and the hand are an exact match, there's no edge overlap. We will correct this by blurring the entire Lightwrap layer, causing it to bleed into the hand area. Why are we blurring the entire layer, instead of just the sunset image? As mentioned in the Reflection tutorial, the order of operations in the Motion render engine has filters process before masks, so blurring the sunset image wouldn't have the effect of blurring the image and the mask (it would only blur the image).

The lightwrap is taking shape, but the edges look a bit dull. Because the background has such a heavy glow to it, we want our lightwrap to be brighter, so we'll change the blend mode of the Lightwrap layer to make it additive. This can also cover up slight imperfections in the edge of your foreground element.

Uh-oh. While the areas inside the edge of the hand glow nicely, the rest of the background is blown out because of the overlap of the two sunset images. We can easily correct this by applying another Image Mask, this time to the layer.
Our lightwrap effect is now limited to the area inside the hand. If you were to solo the Lightwrap layer (hiding everything else), it would look like this:

Our last step is a small tweak: the glow is a tad strong, so we'll drop the opacity of the layer to fix it.
And there you have it: a completed lightwrap effect.

Remember, you can control the overall look of the lightwrap by adjusting the layer's blur, opacity and blend mode, allowing for a wide range of results. Good luck!