Some converted PS-1 engines have different gear ratios then their later cousins that were made with PS-2. So the sound file when loaded does not give exact scale speeds. It can be fine tuned, but if you are "anal" about scale speed and I mean that in a nice way, a converted steam engine is probably not for you. Buy a Manufacture engine with PS-2 or 3.
As far as pulling all those cars and such if your wheels slip a little pulling that load, scale speed will be off. This is not GPS, it assumes gear ration and course tach read to give an approximation of scale speed. Faster you try to go, the more scale speed will be off, especially with tight curves and such, so even layout comes in to play.
An older upgrade really needs to be looked at in total. The person doing the upgrade already took short cuts. The smoke switch was on the harness he just had to install it. The PS-1 comes with a volume pot he just need to solder 3 wires too it.
Smoke fan motor can cause this, PV diodes can cause this, harness can cause this, and of course one of the boards can have a component failure when hot. It is a board set and they can be tested separately, so in most case one or the other is replaced repaired. BUT PS-2 3V Processor boards are obsolete. So if it is bad, you could be looking at a PS-32 upgrade. That would be cheaper since the engine is already upgraded, but the engine needs to be tested.
Sorry your first experience was not good, but that is like buying a used car that was salvaged and resold by a car dealer and blaming the manufacture for the poor quality of the reconstruction, done by some amateur mechanics trying to maximize profit. G
