I have considered the gearing, but the amount of time/effort to regear it, I think I'd first power the other truck. If that's ineffective, I'll probably upgrade to a lionchief +, assuming they use a different motor setup (vertical can motors?)
Styrene because it's cheap, flexible, and won't require welding.
I would use Lionel straights, but the turnouts need to much more broad then traditional, and they're very expensive. I built one out of steel before, and it worked well enough. But the flexibility of styrene will make construction much easier. Gluing instead of welding means I'm closer to the wife instead of freezing in the garage. As for weight/being soft, I don't forsee an issue, but I also don't have the material in front of me. Time will tell.
As for reinventing the wheel; the most dangerous phase is "But we've always done it this way"