Even when fully drawn I keep getting this glitch... is there a fix for it?

Also is there any way to drop lit torches?

I hear first time about this glitch.

No there is no way to do that but in dungeons there are special placeholders where you can set torches.

Are you aiming down at something from a ledge? There are invisible barriers on ledges that can block your arrows.

Only on PC:

http://www.nexusmods.com/skyrim/mods/10394

Torches light up if you drop them, then leave the cell, then enter the cell with the dropped torches.

You can drop torches from your inventory the same way you drop items of clothes, or put clothes in a dresser. At least on the xbox you can do it that way. If you are using a bow from a ledge, the arrow will sometimes not go over the edge due to an invisible area as mentioned above.

No Im not on a ledge.. seems to only happen after reloading.

It used to happen to me after archery killcams. Switch weapon then switch back and you should be able to fire arrows properly.

Same thing can happen from anyplace above. I have also had it happen when ground level. I ended up, on the xbox, saving the game, clearing out the cache and then going back in. Sometimes that helps.