To answer your initial question:
Yes, you can create a "subordinate" insulated section (or several) within a larger section very easily.
There are a few steps to doing this. The short answer is "DC and a diode"
You need to create (or purchase or acquire) a DC supply of about 12 to 16 volts. It is recommended that you use a supply that is robust enough (has enough amperage rating) to handle additional loads as your empire gets bigger. DC is the preferred type of electricity for signaling, due to the fact that relays can be made to slow release, circuits can be made to eliminate chattering, and diodes can be used for logic. Diodes can be considered "electrical check valves" but only work on DC.
You will connect the negative side of this DC output to the AC wire that supplies outside rail power. Now, the AC traction "return" and the signaling "return" are tied together in common. No phasing is necessary.
Create the larger insulated section by isolating the outside rail, using whatever method you choose. Air is my choice, but a wooden matchstick or a plastic pin will work. Within that section, make two more cuts in the insulated rail.
Fasten (solder) a wire to each of these three sections.
The wires from the 2 outer parts (#1 and #3) get connected together and then connected to one of the terminals of the signal circuit. (more later on what kind of signal you will be using *) The wire #2 from the subordinate section goes to one terminal of the crossing gate.
Both the signal's and the crossing gate's "other" terminal get connected to the positive side of the DC supply.
At this point, whenever a train is present, negative DC flows from the two outer track sections to the signal circuit and then through the signal to the positive side of the DC supply. When a train is present on the subordinate section, negative will flow to the crossing gate, through the gate, and then to the positive DC supply
The only thing now to solve is "Whoa, Shorty, what about the fact that the signal will lose power when the train crosses the gate section?" Aha! Good question, Slim.
Connect a diode between the gate wire and the two signal wires, with the arrow pointing towards the gate wire. This allows negative DC to activate the signal but conversely, blocks the negative from the signal wires from activating the gate.
ins section sub section ins section
wire 1 wire 2 wire 3
signal -> pos gate->pos signal -> pos
diode
left side towards signal wires (1 and 3) right side (arrow) towards gate wire (#2)
Sorry, I don't have circuit-drawing capability on this computer. Maybe someone else will step up and draw the circuit more accurately.
*If your signal is a two-lamp (red/green) type, like a 153, the signal wires need to activate a relay that switches power from the normally green indication to the red indication when there is a train present. (Or maybe you intend to use a later model that only requires a single wire activation.) If you are using a semaphore (like a 151) you don't need the relay.