Licat is almost certainly the current Welsh Llygad ("Eye"). This is made explicit by the scribe of manuscript E who translates the name to Oculus Amirmur*. During the 10th C the Welsh LL changed in pronounciation from L to the current LTH* possibly suggesting the wonder was dictated prior to then (see also Linn Liuan). Examples of dictation and transcription errors can be found in classic Welsh texts, for example, Culhwch ac Olwen (* page xvi), so we should be little surprised to find them here, though we await Vol.10 of Dumville's The Historia Brittonum (see Translations) which he notes* will contain a full study by K.H.Jackson of the Welsh language forms.
This Welsh term is still used in placenames in Wales to refer to springs. More specifically Jones* (p.1-3) suggests there is a distinction between standard springs which are called ffynnon (a "spring-pool"), tarddiant (an "eruption"), gofer ("overflow"), or pistyll ("spout" - also "waterfall") and springs that are at the source of rivers, which tend to be named llygad ("eye"), blaen ("top") or codiad ("rising") - though in the case of holy wells named Ffynnon llygad, of which there are several in Wales, the name tends to point to their being held as curing eye-diseases*. The term "eye" is used more generally in English to refer to the main spring point in any spring pool (e.g. see Thomas*).