I have purchased quite a few MTH (Proto-2 and 3) and Lionel (Legacy and TMCC) engines over the past several years. I also purchased one Weaver and one 3rd rail engine. I have noticed a significant increase in issues with new engines right out of the box with all of the manufacturers. I have also noticed that the likelihood of problems is higher with steam engines.
The worst situation I have experienced involves an MTH Proto-3 PRR J1 2-10-4. Absolutely beautiful engine - probably my favorite engine - when it runs. Problem is that the darn tether will not stay connected. I have had it back to MTH twice and have had a few very experienced and helpful colleagues from the industry assist, but to no avail, as the tether continues to disconnect. One time it disconnected in the middle a very long tunnel and we had all we could do to get it out. One example of an issue with a Lionel Legacy engine I have experienced involves a PRR M1A Mountain, with a flickering cab light right out of the box, which indicates a smoke issue, that I am sending out for repairs.
I have also had all sorts of other problems with Proto-3 engines, such as consistent issues with anomalies like the headlight goes off when you turn the smoke off, as well as other similar issues with features on the engines, requiring constant engine resets. At this point, I would much rather buy a Proto-2 than a Proto-3 engine. Far fewer operating issues.
The Weaver B&M P-4 (TMCC) would not operate out of the box and the 3rd Rail PRR FL-9 would not run smoothly because of the bizarre flanged wheel design. Frankly, at this point, when it comes to new engines, I am always apprehensive when I put a new engine on the track for the first time.
My experience has been far better with rolling stock. I have purchased a lot of Lionel, Weaver and Atlas, as well as a few MTH freight cars over the past several years. I have had no issues with them, other than one Lionel PS-1 boxcar that had a truck that had a tendency to derail and an MTH diecast hopper where the coupler shattered.