Well I beg to differ, I edit a lot of assets in my working version of TANE to break LOD and on testing it all seem to work a lot better than a default TANE install with the LOD still in place.
Do I need to point out that some of the rolling stock and locomotives that are included with or sold as add on packs to TANE by N3V do not include LOD.
I'm glad your computer can handle an unlimited number of triangles and textures. However, for the rest of the world, there are limits on how much can be handled. You will either need to limit your draw distance, and other detail settings, or limit the number of triangles and textures being displayed. The latter is preferred, via the use of LOD. There is absolutely NO reason for a locomotive to be 90,000 triangles when it's 15KM away (or 1KM away!). And now imagine, say, 10 locomotives with 60,000 triangles (600,000 triangles total) in that 15KM (lets say 2 on the player's train, and the other 8 located 5KM away), plus 200 wagons (for a 1980s+ era route) of an average of 15,000 triangles each (so 4,500,000 triangles there) (lets say 50 on the player's train, and 150 located 5KM away), plus an average triangle count of 50,000 triangles per baseboard with the route being 3 baseboards wide for that distance of 15km (that gives 62.5 baseboards, which gives 3,125,000 triangles).
This all adds up to a total of 8,225,000 triangles in your scene. Most computers will generally max out at about 2,000,000 to 3,000,000 triangles if I recall right (TS12 generally maxed out at about 1 million to 2 million). So we have a problem here, either we limit draw distance, or limit triangles.
LOD everything so it comes to an average of 150 triangles for the locos, plus 50 for the wagons, and 1000 per baseboard beyond 1KM.
Locos: 121,200
Wagons: 757500
Scenery: 209500
Now our total scene triangle count is 1,088,200. That's a LOT less power required to process the same scene. Plus at those triangle levels you should have just 1 texture per object at an extremely low res (basically just screenshots taken from each direction of the model, and applied to simple boxes). This doesn't even include the progressive drops in LOD as the object gets further away, it simply assumes a drop from full detail to a minimum at ~1KM. This figure would get lower in the scene because of the progressive drops in LOD. This also doesn't count textures, however these should be kept to an absolute minimum anyway. A traincar may have more due to alpha numbers, windows, etc - however scenery should have only 1 or 2 depending on the design - mesh libraries with shared textures on similar assets, especially for tiled textures, are a way to help with performance.
It's not hard to make a LOD that drops you down to below 200 triangles within 1-2KM of the camera. As above, it's just a box with pictures on it.
For example, arriving into Lilydale on the Healesville route causes a large impact to performance. This is entirely due to the lack of lod on the surrounding scenery. It's a relatively built up area (for that route anyway), with most buildings being quite detailed. Had I had the time to build a full set of new buildings (particularly houses), or at least provide LODs for the existing buildings, this would have greatly improved. OTOH, arriving into Healesville (which is a little less built up, but with more objects with LOD around the yard) has less of an impact.
You'll find that every locomotive and wagon used with Healesville has some form of LOD on them. I can honestly say that I saw massive performance improvements in sessions when LODs were implemented on the locos whilst in development. Even with the relatively inefficient LODs used (they simply don't go low enough on most of them).
OTOH, there are built-in assets that we simply didn't have time to either develop replacements for, or at least develop LOD for. Any new built content by N3V for TANE will have LOD (unless it's an exceedingly simple mesh). Much of the new built content from 3rd party creators also has LOD. However there's also a fair bit of DLS content that was used due to lack of more modern equivalents, and hence may have less effective or no LOD. Unfortunately, developing several hundred models isn't something we had time to do.
As to the commodities, as I noted before, if you refuse to use LOD, we will need to do something to ensure our customers can achieve reasonable performance. In the case of commodities, we have had to take more drastic actions. Hopefully with the implementation of good LODs, we will see improvements to performance and these sorts of measures can be reduced or removed.
As a note, any object with a Trainz-Build number of 4.2 MUST have LOD. Removing LOD will make it faulty. It also needs to reduce by at least 20% per LOD, and end below a set threshold (500 triangles IIRC).