Possible but not practical as Roy says. You actually wouldn't replace the electronics in the locomotive, you can drive the IR transmitter from the serial data. At most you'd just need a simple transistor buffer to drive the IR transmitter. Since the K-Line tender has power rollers, you don't have a power problem.
The real sticking point is the IR receiver, that vintage of electronics uses a 3-position motherboard and the AD20 board to handle the IR in the tender.
Of course, you'd also have to rig the sensors to the drawbar as well.
I've looked at this several times, but I've never wanted to spend the time and effort necessary to make it happen. Good idea, but a lot of work.
