Adding sound and smoke

If that is a traditional sized engine, I doubt it, tender does not look big enough to hold the PS2 boards and speaker.  The smoke fitting in the boiler is also going to be tough.  You are looking at over 200 just for parts.  Hardly worth the investment and the time even if you could make it work.  Does the engine have a flywheel?  If not, you can't use PS2.  

I have upgraded two Railking engines and have decided that it is not worth the time and expense to upgrade anything other than a Premier or other higher end engine.  Of course that is just my opinion. 

Actually, I don't see any reason you can't put a PS/2 board set in the tender, looks  big enough to me.  The tender body looks to be a bit more than 5" long, the PS/2 board upgrade is less than 3.5" including the bracket.  I stuffed one of these upgrades into the MTH General, which has an even smaller tender, so I'm sure it'll fit in this one.

I don't know about adding the smoke unit, I'd have to know more about the locomotive to be sure of that.  There are some small Lionel fan driven smoke units you could probably squeeze in, and since the PS/2 upgrade includes all of the logic to drive the bare smoke resistor and fan, that's probably doable as well.