John - we're probably talking about much the same thing! Over here, a shunting tractor is similar to a farm tractor but with a large metal plate fastened to the front and/or rear to push wagons around without coupling to them. Some may also have been purpose built. They do not run on track but are completely mobile, like a road vehicle, hence need a road surface with inset tracks. In Trainz, I think they could be simulated by having wagons on inset track with the tractors running on that track when pushing, but with invisible track and turnouts to enable them to move from one visible track to another. This is just an idea at present - I haven't tried anything (yet).
However, I think you may be talking about IC vehicles running on conventional railway wheels as I have seen photos of these in magazines. Over here, this was tried at one time by the LMS with road/rail buses which could run on either rail or road; in the latter case the rail wheels were raised. They were not considered a success. However, we now have at least one bus service running on a guided way near Cambridge, with part of the route (I believe) on conventional roads.
I've searched for a photo of a British shunting tractor but haven't found one - yet.
Ray