Just subscribing 'cause I want to be here when Geophil puts his two bobs worth in......
Well, uh, yes.
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In the real world we can travel around the World and end up where we started. No edge to fall off!
Yes, it's flat, and it's not so odd as you might guess. Think of the ordinary (cartographic) map printed on paper. Ptolemy is said to have invented longitude and latitude as a method to map the round shape of the earth to paper (or papyrus), nearly 200 years ago. His diameter of the spheroid was a bit off, that's why Columbus expected to arrive in India and ended up in the West Indies instead.
We call this kind of mapping of a round shape to a flat plane a "projection". Many computer simulations dealing with our globe use the flat plane approach. Rumours say that the cancelled MSTS 2 project (2nd attempt) would have been the first railway simulation to use the WGS84 ellipsoid directly and do their projection on-the-fly, since it was based on the Flight Simulator X engine. But all others are definitely flat. MSTS 1 had the Goode Homolosine projection (the orange peel), RS/RW is UTM, so is Zusi. Trainz is somewhat neutral by default (although there is some sort of projection in place to calculate the orbits for the sun). With TransDEM, Trainz becomes UTM, too.
... Our planet is NOT a sphere, nor is it 'round'. It's an oblate spheroid. It bulges out a bit near the equator and is 'flatter' at the poles.....
It always depends on what you want to achieve. Our first approximation is the plane, which isn't that bad, provided a suitable projection is in use. The second approximation is the spheroid (Microsoft Bing, Google Maps, OSM). The third one is the ellipsoid, "oblate spheroid", (Google Earth and almost every map projection used for topographic purposes). Finally the Geoid, the true shape of the Earth, irregular and complex and not really needed for most purposes.
So, all in all the Trainz approach is pretty reasonable and would stand its ground even under scientific challenge. You are simply not supposed to come anywhere near the edge because that's where the models ends (literally).