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I've read of one layout using "live" 3rd rail - this was in the era before DCC became affordable. The builder added third rail pickups to his stock to power interior and head/tail lamps while stationary, there was also one model with operating sliding doors that used the third rail for power and control of these. This was in P4 (ultra-finescale 4mm) so the system worked pretty well. I think to make it work well in HO you'd have to change to Proto 87 as the tolerances would be very tight indeed.
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