MSTS should run fine on that hardware. That was 2000 era technology, or about the time of the earliest Trainz version.

Finding an active MSTS community might be difficult. When Microsoft had theirs, I was quite active in their forum. In the end, it became a spam haven. Shortly after that, the forum closed down.
Those are great video cards, although now getting a bit worn out now with the heavier and more demanding graphics. This would explain Bandi-Cam killing the FPS on you. There just isn't enough bandwidth between the software and drawing the video. I saw this with Fraps and an old video card I had. I'd load Fraps and my system would die. After I upgraded to my much later, and much better ATI 6950, both ran well together. Today with the GTX680, things are even better - not even a twitch.
I keep hard drives like that too. My old Sun Ultra 10 has a 20GB drive in it that's now going on 12 years old. It still works fine, and will continue to do so until it doesn't. There's no compelling reason to upgrade, so I won't. The problem though really is replacement. The old system doesn't handle anything bigger unless I figure out how to upgrade the BIOS, or whatever they call it in that system. My other systems, not my Trainz computer, have really fast SCSI 9GB drives in them. These were expensive drives when new, so I've sure gotten my money's worth out of them. I only repace a drive when it starts giving me trouble, or starts making weird noises. I did lose a 500MB drive, but that one was already 18 years old when that one died. It was in a proprietary system that ran special software. I had a complete backup, which I made by taking the drive out and connecting it to another system. The complete contents fit on a CD. This system is still operational today, albeit with a 1.2GB drive instead.
I agree. Run whatever you want, and enjoy every minute of it. There's no one saying you can't. And all of this has to be fun. When none of this is fun, it ain't worth doing anymore.

I too am avid railfan, having chased trains since I was 3 years old when my dad brought me over to the fence across the street from where we lived at the time to watch the trains. Today the very active rail line is better than ever, and hosts the Downeaster and a bunch of commuter trains.
John