How does my child which letters to use

Most of us learned how to spell with a combination of teaching at school and memorization.

Congratulations! You've discovered one of the flaws in our educational system. Rote learning may be tedious to some. But it works.

This applies to the word "light" (not heavy) and "light" (not dark). You're going to have to understand how to show your child contrast and learn the flow of language.

How did you decide which one to use when you were learning?

The way I learned was to separate the abstractions of each sound to diligently understand what makes a word with very likened properties reflect different aspects.

It goes back to how people today compare the shadow of an orange to the shadow of an apple, rather than compare the apple and the orange as they are not different for the former, but very different for the latter.

That was a rhetorical question to the OP.

It''s not rhetoric. It's alluding to the secrets of language. When you get rid of the meaning, it's all vibration and abstraction.

I would say when you get rid of the meaning, it's all gibberish.

Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.
Many of us learn fine without rote.

(Do you understand now?)

When it comes to spelling a given word and that word could be spelt using any number of (phonograms / blends / digraphs) how does my child decide which one to use? ie O (o, oa, oe, oo, ou, ow, ough ) so boat could be spelt (bote, boat, boet, bout, bowt, bought).

IMHO, your child would have to decide between boat and bote, because (bout and bowt) and (bought) sound different from boat.

Boat/bote (ow) is a long O, it sounds like coat or pope.

Bout/bowt (aw) sounds like owl or crowd.

Bought (ó) is a short O, it sounds like dog.

I bough to your superior understanding

Mainly because of his or her effusions, 'One-eyed-mind' reminds me irresistibly of what Australians call the 'one-eyed trouser snake' . Unfortunate, but thus very apt, choice of moniker.