Putting pool putty in the conduit to seal it won't hurt anything, but there is a better way to seal the conduit. It's a product called Butyl Tape from Anderson Manufacturing in St. Paul MN. 800-348-1316. It's butyl rubber in a strip, you pack it around the cord, up into the conduit, as tight as you can get it. It will stay flexible and is easilly removable should you ever have to change the light fixture, just remember to repack the conduit after a light change.
As far as the niche, you need to clean it out real good and and inspect the interior, It's true that copper niches are susceptible to chemical imbalances (low pH) and have been known to develop holes. These can be patched with Pool Putty. Be sure that the area around the leak is nice and clean before you put on the epoxy.
Also, take a look around the outside edge of the light niche - where the plaster meets the outside of the niche, you should patch any gaps in that area.
Owner, Superior Pool Services
25 years leak detection experience