Quoted:
Is the only reason the M600 has more output due to having a second battery or is there more to it?
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In the case of the M300 and M600 scouts, essentially yes, the 600 runs on 6-volts vs the 300's 3-volts. That's why they use different model heads and the 6V one takes advantage of the higher voltage to drive a stronger light.
Or a more dumber question, the more lithium batteries you have the more output, or does it increase run time?
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Either, depending on how the light is made and what the purpose is. Some lights have a voltage regulator that either up or down converts the voltage of the battery(s) to drive the light at a certain output, and the battery's ability to dump enough current can also impact what can be done. So for example a lot of lights using 18650 batteries are only a 3.7 volt system, but take advantage of that battery type's very high discharge current to drive a usually very powerful light. On the other hand, some brands/models might rely on multiple batteries to provide longer run time at a lower output, it really all depends on how the light is made.