There are recessed lights available that are "insulation friendly."

I'm not an electrician, but I've heard that type "IC" fixtures are safer than the typical vented recessed lights, and that IC fixtures can (and should) be used even in uninsulated ceilings.

Family Handyman magazine had an article how to build a box around the recessed lighting and then insulate around it. I don't know how big the box had to be or what it had to be made out of, but you may be able to look it up somewhere.

Good luck,
Devildog

Yes, the 'box' is a good solution if you do not want to replace the recessed fixtures. The 'IC' class allow insulation right against the fixture. However, your draft problem would be best served with the 'IC Airtite' class that does not allow air infiltration through the fixture and allows insulation in contact with the fixture.