taki53-
K-Line made two versions of the LIRR MP-15 (one with horn and a series/parallel run switch, and the other without), but in either case it sounds like an electrical short within the locomotive caused the problem. The overload likely burned the wiring, which would explain the smell you observed. At best the overload charred a few wires, but it is also likely that the reversing unit and/or one (or both) motors was damaged.
Fortunately the MP-15 is a very easy locomotive to troubleshoot and service. Start with removing the shell - disconnect both handrails from the cab (they pull out of the hole with little pressure), and unscrew the Phillips screw on the front of the locomotive close to the frame. Once removed, slide the entire shell forward, and then up. With the shell removed, look for wires that are charred and/or have melted insulation, then examine the reverse unit circuit board for burns and evidence of exploded components. Also check to see if any of the soldered connections are broken, or if any of the wires have exposed insulation.
If everything checks out above the frame, turn your attention to the trucks. The trucks are secured to the frame with horseshoe clips; using needle nose pliers or a similar tool, stretch the clip to release it from the stud. I would recommend doing this with the locomotive on a flat surface because the clip is the sole means of holding the truck to the frame. Although mechanically detached, the trucks are still tethered to the frame by the the motor, third rail pickup, and ground wires. Four screws hold the truck frames to the truck (two of the four secure the pilot and coupler); remove these to expose the wire connections and the motors. Note the motors are horizontally mounted and that the truck frames are metal; it is possible that one of the motor wires touched the metal frame, causing an unintentional ground. With the frames off, look for more broken/melted/charred wires and replace with new wire as needed.
If everything still looks normal, try troubleshooting the motors. Note that these motors are DC, which means a regular AC transformer cannot be used. I recommend using a 9V battery with a snap-on connector (Radio Shack part #270-325 or equivalent). Touch one lead to each motor post to see if the motor spins; reverse the leads and the motor should spin in the opposite direction. Repeat for the other motor. If both motors are working normally, then the reversing unit circuit board is likely the culprit. Replacing the e-unit is easy, but you will have to solder the wires from the new board to your existing harness. Its best to make a diagram, then go wire by wire.
Although K-Line is out of business, parts are still readily available from Brasseur Electric Trains. The reverse unit is part number K2200-E001; if needed the motor part number is K2200-E002. Brasseur also has other parts for your MP15, including the weight set, couplers, horn, bell, and more.
I've worked on MP15s before, and I can make the repairs if you prefer.
Hope this helps!
-John
