I just picked up a NIB #28578. Out of the box it doesn't appear to smoke very well. Here's where I get curious! I popped off the roof panel and see the smoke unit is attached to the roof. I then removed the smoke unit from the roof assembly, put the engine back on the track and it smoked perfect.
It appears the funnel assembly is causing a major restriction. I looked at Lionel parts and they list the roof/funnel as one assembly the the two must be glued together at the factory.
Any other owners see the same issue with their units?