Just one more case where seeing it in the locomotive would have made it easy to verify what you have. 
Seeing what the smoke unit actually consists of, it does seem that the CV board ran the fan and the smoke element connected directly to the track power. I actually took that one out and tried it, worked great on track power with a DC supply for the fan.
Now that we know what we're dealing with, my modification instructions were valid, but the two resistors will also have to be changed to the standard MTH PS2/3 16 ohm resistors.
