The sun and moon, each 32 miles in diameter, circle Earth at a height of 3000 miles at its equator, located midway between the North Pole and the ice wall. Each functions as a "spotlight," with the sun radiating "hot light," the moon "cold light." As they are spotlights, they only give light out over a certain are which explains why some parts of the Earth are dark when others are light. Their apparent rising and setting are caused by optical illusions.
In the "accelerating upwards" model, the stars, sun and moon are also accelerating upwards.
The stars are about as far as San Francisco is from Boston. (3100 miles)