Happy birthday from me as well.

The static meshes cast shadows and receive shadows.

I can produce a better example if you like. Here you see only very low-res shadows since this level is big and you see only a little corner of one of 6 rooms. Besides that you can change the resolution of shadow maps in the Torque engine but I did not found a way to change it in Constructor so far.

But if I re-size the scale of the models I can create very sharp shadows if you want a proof
But you can have a look here to see that better shadows can be made:

http://www.garagegames.com/products/torque/constructor/

Regards,
Frank