The electric hand torch was invented toward the end of the nineteenth century. Patents for various designs, aimed at commercial application, date from 1896 to 1898. While they were probably not quite as portable and inconspicuous as the one Vere used in this book, I feel quite confident that given the available technology, a talented and dedicated engineer working for the Crown could easily have made just such a James Bond–ish gadget.
The passages on Capri are quoted from A Handbook for Travellers in Southern Italy and Sicily, and By-ways of Europe. Both books are now in the public domain.