Not crazy about the "China Lionels" reference at the outset here. It is easy -- I've done it myself -- to bash the nationality as the reason for the issues but it is more likely a question of basic quality control and the cost to get it right.
In terms of the damage some have seen on their locomotives, that is unfortunate. That being said, I would be cautious about attributing that to QC, particularly for defects that appear physical in nature. Those could have occurred during shipping, which is rough on model locomotives. Given the nature of the hobby today and the erosion of the local hobby shop business, shipping damage is part of the gig today. Personally, I am very hesitant to ship locomotives for this reason.
Finally, people talk about the cost of quality control but at the end of the day people do not pay for quality. With all respect, look at the big boy price wars that went on here on the forum -- vendors undercutting each other by a few bucks to get the business. On a $2k loco, such price differences are immaterial but they swayed buyers. Are these same folks now going to claim, with a straight face, that if Lionel wanted to add hundreds of dollars to the cost of each locomotive to personally test each one for, say, 8 hours, that people wouldn't care or it wouldn't negatively impact sales? Not realistic and not consistent with our society today. Everyone says that they want quality but to take a completely different example they buy furniture at IKEA while Henkel Harris, Statton, and other great American firms that make a truly high quality product die on the vine, one after the other. Most people today want the look of quality but they don't really want to pay for it. This is why you see the proliferation of cheap junk and endless consumption, "paid for" on revolving charge accounts.
In the interim, the good news is that the big boy is a locomotive for adult collectors/operators who, if they are patient, will have things made right by Lionel. I have been disappointed as well in the past but the people there are honest and the issues will be corrected. I would contrast this to a less defensible situation where those kids we all desperately want to see join the hobby are upset/frustrated by a basic lack of quality control on, for example, a PE starter set.
Just my .02.