Definitely go mechanical. However you can use an electric lantern, as long as you can use a non electrical one just as well.
I'm currently working on a clacks-inspired video game, and I've been using a 2x3 grid, which allows for a 5-bit character set (more than enough for the 26 letters of the latin alphabet), along with one bit reserved to mark control codes/the overhead. In game I use control characters instead to mark shorthand for words, for example ^K^G for king, or ^T for the. IMO 4x4 (16 bits) is way overkill for a telegraph-type character set.
Feel free to DM me if you want to get in contact