Right. If 100% (on), 50% (dim), and 0% (off) are all you need for "adjustability" then all you need to do for incandescent lighting is to insert a diode to effect the dim mode. A diode cuts the AC power in half (50%) since it only applies power to the bulbs on 1/2 of the AC cycle.
When O-gauge went to command-mode with its ~18V AC track voltage, a common "complaint" was the bulbs in passenger cars were suddenly too bright. The bulbs were typically operated around, say, 12V in conventional control. So before LED lighting was practical, the simplest solution was to insert a 10-cent diode which cuts bulb power in half. When you do-the-math, cutting 18V AC bulb power in half using a diode drops the effective voltage to around ~12V....imagine that! 
