Well, I'm happy to report early success. Keep in mind that I've been a casual sim-er for years. This is not the first time I've messed with DEMs and maps in this (or other) sims, but I've never put much follow up into those efforts. So, anything I dream of is going to take months and years! I'm trying to get a grasp of some of the methods so I don't waste more time going down a wrong path.
One thought I have is to recreate the Copper River & Northwestern from 1911 to 1938. Now this is a 193 miles long and I'm just a beginner. I'm not even sure if it is possible for me to ever do such a route - I might compress it. But I won't make the mistake of doing even that as a newbie. I want to start with a 2-mile stretch of rail, from just south of Chitina, over the Copper River, and just past MP 132 on the way to McCarthy. I figure if I can not master the skills to build this very short span, then I will never build a 200 mile route and I should just play with trains or stick to one-baseboard fictional routes.
As I said, my survey maps are blurry scans. The originals contained valuable info for a rail that no longer exists. So, I will try to track down copies later on. I can use modern tools (Google, Bing, USGS, etc.), but the rail is long gone; even the USGS historical data only goes back to 1950. Luckily, the modern "highway" (often a gravel road) follows the rail bed precisely for much of the route. Ironically, I am pretty sure I picked one of the places it diverges as my starting point. Yet as it is, I cannot even seem to match up my survey maps with the best photo I have of this section of rail.
So, here's four pics: 1) The Survey map, even more blurry because I shrunk it to post here, 2) a photo probably from the second or third (last) decade of the rail, 3) an early attempt at using TransDEM to load the DEM and Google Maps images and then export with the WebColors. (I will give MS Bing or whatever a shot too), and a much earlier (1912?) pic of one of the trestle bridges over the Copper River. (There was only one trestle bridge over the river - it was replaced every year, though.)
p.s. So, as I said, I might give up on geo-referencing my maps until if/when I get better maps. But thanks again for all the help. I'm learning a bunch in TransDEM and in Trainz.