He's standing in light rain, with C staring straight at him, standing 30' away.N doesn't lose hidden until he is seen clearly, or makes an alerting noise.
He can be seen clearly. Seriously go outside and try it for yourself.
You agree N cant hide in light rain under direct observation, so how on earth is N remaining hidden in light rain under direct observation?
You can make whatever rulings you want. But the rules state that as soon as N leaves his hiding spot and enters somewhere he cannot hide, unless C is distracted (DMs call), C spots N immediately.A perception check is a reasonable way to arbitrate such a situation (even if the DC is Impossible, no roll required).