Bruce,
Why can't the 1050-1032 cable be plugged directly into the Legacy Base data port?
You can do that, except that then your Legacy engines won't work properly if configured as Legacy engines. You won't be able to use their Legacy commands, including movement forward or reverse. Legacy speed control commands are different from TMCC speed commands. This is due to a limitation of the Legacy base, not something that MTH did or didn't do.
The issue is that the Legacy base was never intended to accept Legacy commands via its serial port. The only engine commands that the Legacy base's serial port can accept are TMCC commands. This was never a problem when using a DCS Remote because the DCS Remote configured Legacy engines as TMCC engines and could therefore control Legacy engines using only TMCC commands.
You could use the DCS App the same way if you configure your Legacy engines in the DCS App as TMCC engines. However, then you couldn't run them using their Legacy-only commands, including things like the quillable whistle or horn.
The solution is to use a Lionel SER2 to which to connect the TIU. Then, you can connect the SER2 directly to the Legacy base's serial port and everything works. You'll need only the SER2 module and the special cable, inanition to the MTH #50-1032 cable. You won't need the more expensive LCS module.