You can't just draw it in a different place. In your example is has to be drawn over the whole scene and thus fill the whole screen so moving it would make gaps in places.
The shadow layer is a second buffer, just like the the display backbuffer. In the normal backbuffer you draw your scene, the sprites, trees, enemies and whatnot. As you draw their sprites (or in a separate process), you draw their shadows to that "shadowbuffer."
Here's your light triangle (thumbnail doesn't render correctly because it has alpha:
Once all that's done you put the two together.
This is basically how I would do it, except I would try to see how many more features I could work in (except I would probably get frustrated and quit after I couldn't get them all in.)
cast rays and draw long shadows
desaturate and blue-tint the shadows.
introduce surface hilights and shine onto some sprites
blur increases from their light sources
overall amplify the light blending that's closest to the light source.
put in a little mini lens-flair
Most of these require shaders. The end might look something like this (photoshop):