Until the engine itself is tested by a Lionel technician, it will not be known if the loco or buyers' command system/layout is at fault. Then again, something may have happened in shipping, as your story is repeated many times over with brand new equipment not functioning out of the box and/or broken parts. Unfortunately, factory packaging does not protect equipment well in shipping, and is a major issue all manufacturers face. Products should be bubble wrapped for shipping; the hard styrofoam does not protect delicate equipment well at all.
Larry