UE3's lighing model is hundreds times more compled and advanced as HL2's, and thats with HDR. HL2's shadows aren't exactly dynamic, in the sense that shadows will never change shape, sharpness, or intensity, depending on where the lightsource is. UE3 can do that.
acutally, scratch that.
First of all, one can't compare UE3 and the source engine directly. that would be like comparing the Unreal Engine and the Quake 3 engine directly. the clear winner is obvious. UE3 is the clear winner in year-old Source vs. not-yet-released UE3. UE3 is a very complex, powerful, and advanced engine. and its obviously more so than the Source enigne will ever be.
as for scalibliltiy, the lost coast by far. a GeForce 4 can run lost coast, but not UE3, not by a longshot.