The PowerHouse puts out a pure sine wave as does the KW, there's no "peak" issue. One likely problem is the fact that you have dissimilar transformers that doubtless have slightly different output voltages across the gap, that will cause an arc. If you're going to transition between the two power districts, the voltages should be nearly the same on each side.
Of course, if you're getting a really big arc, it's more likely the transformers are out of phase.
Try this.
Turn on both transformers and set the KW to the voltage you'd normally use. Obviously for command operation when crossing over to the PowerHouse powered side, I'd assume pretty close to full throttle.
With a voltmeter on the AC volts scale, measure the voltage difference across the insulated track joint on the same side of the track. It should be no more than a volt or two. If you see a large voltage, it's likely you have the transformers out of phase. If that's the case, reverse the KW plug in the socket and see what result you get.
