It takes practice, but with a Dremel tool, a healthy dose of patience, a good selection of soldering irons, and not worrying about making mistakes you can fix just about anything on a die-cast or brass locomotive. I used to heavily modify HO locomotives when I was younger to match prototypes I was seeing in photos.
I currently have a Weaver brass 3 rail G1 Pacific that I want to modify into an early CNJ Pacific and convert to two rail. The only thing outside of my skill level is turning the wheels on a lathe to convert them to two rail. The rest is just as you suggest. Moving a headlight, changing out a few appliances, and a decent paint job.
I enjoy this kind of work, but my full time work has me too busy these days to actually dive in. Should you decide to go for it, best of luck to you!!!