I think Brian really hit it on the head with 2 quotes:
"It’s looking more and more to me that this deal was more about Atlas getting access to the MTH factory than the tooling."
Bingo! I believe this has been Atlas' real problem over the past few years - manufacturing. And the deal solves the issue.
"The real value in O gauge was K-Line. It’s a travesty that they couldn’t stay in business."
Amen, amen, amen! There are some aspects of MTH that I will miss, e.g. accessories, steel-related cars, PRR N6b's. DCS is not one of them. K-Line, however, was on the verge of eclipsing everyone in 2004 before their somewhat sketchy decisions sank them.