Presumably you have MTH Realtrax? In which case, yes, the lock-on BLACK is only connected to the outer rail closest to the side the lock-on plugs in. Without getting into the "nuances" of why other track systems electrically connect the outer-rails within each piece of track section is a separate discussion.
Meanwhile...back at the ranch. I re-read your original post. As I understand it, the GP38 was purchased used. What assurance do you have that it is functional in conventional mode?
Hopefully one of the MTH/DCS gurus will chime in, but I can imagine a failure-mode where an engine can function in DCS command-mode but exhibit the behavior indicated in conventional mode. In other words, the previous owner who only operated in DCS command-mode could say in good faith that the engine works great.
