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I DEM gives you a approximate, general idea, of where the roads, track, and rivers are to be placed. They are generally off by + / - 20' in any of 6 directions X-Y-Z. Gradients can be rediculously way off, and simply hitting the smooth spline tool is not enough. On My Horseshoe Curve route I found that generally a 1.8% grade, from Wilkes Curve to Tunnelhill, for 11 miles achived the right height results at the summit of the mountain. A DEM simplifies terrain creation by 1 million fold, but also makes gradient construction a nightmare. An ungraded DEM gradients, resembles a rollercoaster. A huge DEM may take you a year to complete, where as a flat baseboard route could take you forever to make the prototypical terrain. And hand crafting your own terrain could produce rediculously jagged, pointy, mountains only found in the Swiss Alps; in Altoona PA. lol
Also laying track on a DEM is made easier by changing your Trainsoptions file, by adding the line: -surveyorfov=35
And temporarily changing the line to: -surveyorfov=185 gives you a super-wide angle, distorted view. This wide angle view is also great for manipulating basemaps. Changing it back to any low number you wish, (I prefer @ 35) the Trainzoptions file is a handy dandy tool. Keep a log book of things you change...so you can re-edit them back to the original settings.
Lay your track only with the intended flow of traffic (EB, WB) dirrection.
The technique of laying track by using the "Hold Shift" key...is anther cool tool that you will find eternally useful !
Using G Fishers-"PRR Track Guide" will help you achive tight, proper, prototypical, track center, to track center spacing.
You get...what, you pay for !