The subject of "correct" wheel gauge has come up before. There's no real standard for 3-rail, and for classic Lionels it varies by locomotive. For example, the large 700-series Hudsons should be gauged on the narrow side if they're expected to run on O31 curves. The little 2-4-2's are gauged wider so they don't "hunt" from side to side on tangent track. I did a search, this link will take you to some recent threads on the subject:
https://ogrforum.ogaugerr.com/...ation.sort=ITEM_DATE
I also did a search for RJR's posts about installing a Timko motor in his 736 berk. Same drivetrain as your Warhorse, and he had similar problems to yours. Scroll through and read some of these threads:
https://ogrforum.ogaugerr.com/...ation.sort=ITEM_DATE
After watching the videos a 2nd time, your loco isn't too bad (and with a consist it would be even smoother.) Hope you're able to improve it fully. Good luck and thanks for sharing your project!!
