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In the 2010 ISO version of Shandalar, I have several times seen the AI cast spells with no target at all. The spell shows up in the spell batch, but the place where the target would be is empty, and the spell goes into the graveyard with no effect. This has happened with Lightning Bolt and Divine Transformation. Is this a known issue with specific spells, or a general problem?

If your test is on duels or gauntlet save game that turn and attach the savegame please maybe we can see what has happened.
In Manalink3.0 (and Korath's shandalar updates also if I am not wrong)we have the target not showing correct at times as a result of a problem in that function that couldn't be fixed but the important thing is that actual targeting is fixed to work correctly and validate the correct target (when we have coded the card accordingly that is).