That did it! What a great forum here! I would have spent days trying to figure this out.
Does any of the Lionel documentation say anything about the "catch" versus "hold" position of the whistle switches anywhere? Seems awfully important.
Of interest, while playing around with it trying to get it to work earlier today, I read that someone using a KW transformer reversed the "A" and "U" pins to be opposite of what the transformer says (i.e. use the U post as the center rail instead of the outside rail). When trying out Bmoran's solution just now, I still had it wired opposite (wrong) way. Interestingly, instead of a horn, I got a constant dinging of the bell as the engine roared around the dinky little test track. Another pull to the "hold" position shut the bell off. All other PS1 functions were the same.
When I swapped the wires back the way they were supposed to be (U is outside rail), The horn and everything else worked just as expected. I feel like I got an absolute steal on this guy, everything is working great, the engine looks amazing, and I'm just so happy that I got the deal I did on this. No box or anything, just an engine that sat on a shelf for its whole life. Looks and runs like it's brand new!
Thanks a bunch!
