Nice plan in a small space. I'm not familiar with the switches you are using. They are totally manual? Assuming that they only feed power to the center rail, in line with the direction of the turnout- then place a insulated pin on the center rail a section or two before the turnout. This will kill the power to that section and give the train enough room to stop before catastrophe strikes.
I made a insulated outside rail block for a set of cross-buck signals. Very simple to do, just open up the metal clips holding the tie to the rail and insert a small piece of card stock under the rail (just like the center rail). A tip I learned is to pre-bend the card to fit the rail before setting it in place and then re-fold the tie- clips back down. A couple of insulating pins on either end of the rail and you are good to go. You can see the insulated rail in the beginning of this video (notice the white card under the clip in the inner rail).
