grades on curves

Use the circumference of the curve.  3.14 X 42 / 2 = 66 inches.   1.25 inches of raise in 66 inches would be about a 1.9 %.   I can not advise you on your other questions. 

Your best bet would be to have a steady grade from start to finish.  Just a matter of calculating how long your total run is, straights plus curves.  As per David, a full circle of O42 is 66" (5'-6") in circumference.  So a half of the circle would be 33" (2'-9").

Adding up your total run (7' + 2.75' + 3.75'), you have real close to 13.5' total run.   A 5.5" rise over 13.5' yields a grade of 3.4%.  A little extra room at the start and at the end of the grade would give a little room for transitioning between level and sloped.  You don't want abrupt transitions, as it will cause problems.

Raising the outside rail on the curve might help you run your trains slightly faster before centrifugal force allows them to fly off into space, but isn't totally necessary.

That's my opinion, your mileage may vary. 

Thank you David and Paul.  It is especially helpto know that I can use appproximately the same grade on the curve.  Doing so reduces the over all grade.

Agree with what is posted above. Two things to add:

If you have concentric curves (like a two-track main), the inner track rises more quickly than the outer track, since the sharper curve means that the train travels less distance for the same elevation gain, compared to the outer curve. So be sure to calculate your grade based on the sharper of the two curves. And remember to do that again later, when you are actually building your benchwork! It's an easy mistake to make (ask me how I know), to just measure the edge that is closest to you, without regard to whether it is on the inside or the outside of the curve. This can make some difference even with a single-track grade, but is a bigger deal with double track, obviously.

For maximum adhesion, I would avoid super-elevating the curve on a grade. Steam locos, especially, have a long, rigid wheelbase, and the super-elevation can make for a situation where not all drive wheels are touching the rails at the same time. Not what you want on a grade. That being said, the super-elevation looks really cool. You may want to do some experimentation to see what you can get away with.

3.8% grades. I never had a problem on any of the curves.  Holding speed down is more difficult than the up.