Tom, the code 125 rail I have is glued to the ties, no spikes. The flanges are contacting the ties. The reason I bought the code 125 rail in the first place was that people said it would work with high rail wheels, Not True. I am using the .138 MTH flex track and rail. Most everything runs on that with the exception of the latest run of Lionel PA's. they hit the moldings that hold the rails to the ties. The problem we had with high rail wheels and .138 rail was the ballast. We had to go over all 700' of track and chip out any piece of ballast that was higher than the top of the ties and near the rail.
The .138 SHS/MTH rail looks better on the layout than the code 125 rail. The reason is the railhead of the MTH rail is much thinner than the code 125 rail. The difference in height is overshadowed by the width of the rail head. Code 100 is of course much smaller. It was not an option for me.