A newly developed adaptive-grid finite difference scheme is applied to the simulations of Z-pinch plasma channels for the light ion beam reactor-Study LIBRA. Besides its powerful adaptation scheme to resolve the steep gradients in temperature, density, momentum and electrical resistivity, the one-dimensional radiation magnetohydrodynamics code developed by the authors accounts for the anisotropy of the radiation field in an optically thin plasma. Comparisons with previous studies by Freeman and co-workers indicate the usefulness of the new features in the study of plasma channels for light ion beam fusion. Applications of the new code to LIBRA indicate the feasibility of using argon and nitrogen for the channel plasma. These were ruled out in favour of helium by earlier calculations using a radiative diffusion model. The present calculations treat the thin plasma in the channel more accurately than the diffusion approximation, leading to conclusions different from the previous ones.