Basically the problem is that the o gauge 3 rail world is diverse and Lionel and the other companies had to figure out how to navigate it. I would hazard a guess that Lionel's most profitable market right now is the scale side, the 1500-2000 buck engines, the scale detailed freight cars that cost 60 or 70 bucks, they command premium prices for those and the margins are likely high. The more traditional sized stuff, the lionchief/lc+/lc 2.0 to me is a kind of 'gateway' drug, they introduce people to the fun of remote control without breaking the bank. Menards is kind of covering the traditional stuff as far as cars go, RMT sort of covers that, too. Atlas is really scale as is 3rd rail, relatively expensive.
The novelty sets are what they always have been, to toy side of it to get kids and younger people into it, back in the day we had those operating cars, the helicopter car, the space car, the accessories, they had the 'ladies train', they had sets later on based around merchandising of popular products. The coors light train, the Polar Express, the santa trains, the frozen train, is based on a similar thing, get kids something they will enjoy they know.
I will add that I don't know if you have been looking at HO prices in Model Railroader or N scale for that matter, the engines, not talking brass, are pushing into the 500-600 dollar range (saw a rivarossi engine for that much), freight and passenger car prices are going up a lot, too, you see HO scale cars that are in the 40,50 buck range. While most engines can be had with either dc with DCC compatible plug or with DCC decoder in it, they are still expensive. The price of HO track isn't that cheap, either, last I looked. Like with O gauge, of course you can go cheap, you can buy stuff off fleabay or used at shows pretty cheap, there are still relatively cheap new product out there and of course there is a lot more offered, but these are still pretty expensive hobbies. Lionel prob knows what sell and honestly with traditional stuff, with everything outside engines, why buy new when you have like 75 years of post WWII you can buy? Unlike engines boxcars and the like don't really wear down and are easily fixed. With the engines, you can run post war, if you want to have some ability to run remote you can use a powermaster with legacy or tmcc command base to control your conventional engines. It would be great if lionel produced new offering in scale and semi scale in large numbers, but isn't going to happen.
