Joe,
One of the diodes needs to be reversed consistently - choose the same direction for the all of the L's and all of the R's. They are only needed to prevent the controller lights from flickering. All in the same direction will stop the current flow.
Z-Stuff DZ-1000 for non-derail
I like the way Ross suggests a 3" spacer track between the switches for the 4-way yard . I use that for power control and the non-derail trigger rail. It looks like you could move that point to the track after the switch end - the two short center straights and the two outsides curves to parallel.
