Posting this so no one else loses their mind like I did because the achievement wasn't unlocking for me.

There are 10 lighthouses in Ghost of Tsushima DIRECTORS' CUT.
8 lighthouses located on the Island of Tsushima and 2 lighthouses located on the Iki Island.

You do not need the Iki Island lighthouses to unlock this achievement, having 8/10 lighthouses in Collections is fine.

The Tsutsu Lighthouse in Izuhara seems to be bugged and no matter how many times you rekindle it, you can still keep on rekindling it.

Make sure to rekindle the Tsutsu Lighthouse again, and then just start fast traveling between all the lighthouses and the achievement should pop. I have no idea why and how this works but just fast traveling from one lighthouse to another unlocks the achievement eventually.

If that doesn't work for you, there were some other posts I was able to find where the achievement popped for people because they rekindled the Tsutsu Lighthouse again before they rekindled the final lighthouse, so feel free to try that as well and let me know if it works.