I have done three methods.
Masonite on either side of the outside rails and "N" scale foam track bed on the inside. The foam is perfect to fit in the gauge and has a natural bevel for the wheel flanges.
The 2nd was the same as above but I used dollar store foam instead of masonite. You will see in the one pick, the foam can warp if not glued well.
Then I tried this. It was dollar store sand and a white glue mixture. I watched this video from another forum member. I guess it looks OK. It took a long time and was hard to do... and let's face it that track is never coming up. if it does, it will not be usable again.
The "N" scale foam does work well in the gauge though.
Have Fun !
Ron