I had time this morning so wired DZ-1000's in place of the Atlas O switch machines. Ever thing worked fine. Again I do not know what is wrong with the Atlas O machines since they work when they alone are connected to power but not when the Atlas 200 snap relay and DZ-10011R are in the circuit.
Below are photos of a DZ-1000 in place connected to an Atlas turnout. I did have to carve out a small section of cork roadbed under the throw bar otherwise it interfered with the switching. I will need to pay attention when it becomes time for ballast that I do not fill up the hole in the cork roadbed.