Martin's approach will work for small routes. The internal map projection in Trainz is unknown, i.e the transformation between geographic coordinates (lat/long) and Cartesian coordinates, the rectangular grid where we place our objects. The projection could be spherical, ellipsoidal, equal area, conformal, cylindrical, conical, azimuthal or whatever. We don't know and we don't know any of the parameters. Almost any assumption will be erroneous and that error will be systematic. It will increase the further away we get from the World Origin object. The increase will be non-linear.
If you want to use lat and long, stay close to to the World Origin. Do not attempt to merge two routes built with this approach. They will not match.
To avoid this error and still taking a manual approach, use UTM coordinates in Google Earth instead. These are Cartesian coordinates in metres and they will fit to Trainz without any map projection error. Turn on coordinate display in Surveyor and take a note of the offset between UTM coordinates and Trainz world coordinates. This offset has to remain constant for all basemaps you place. As long as you stay in the same UTM zone (several hundred kilometres in east/west direction, the entire hemisphere in north/south direction), even seamless merge between two routes can be achieved.
If that all sounds much too complicated, there is an automatic approach available as a simple-to-use alternative. It's called TransDEM, has been mentioned above, but is payware.
geophil