I am not surprised DCS is not working for you.
DCS talks to the engines over the rails, not via radio like TMCC or Legacy.
This is why DCS needs blocks with only one power drop to the track per block.
The signal will reduce in power as it travels down the rails, so there is some slack in the following but one thing is paramount, Only one power drop per block !!!
FIX:
Make your modules connect by isolating the center rail at both ends of each module. Then Add Susan's filters to each power drop or even better to both ends of each module. They wire from center rail to outside rail. They use no appreciable power at all and are small enough to hide in the ballast between ties.
Also use all 4 channels of your TIU, they each have a signal generator so you get more signal that way.
One channel per track will serve you well.
Now, You can have up to 11 joints in the track in one block. This is because the signal drops a lot at each joint, too many joints means no signal. Therefore if you have some modules that are not isolated, disconnecting the power drops to all but one in each group will make DCS work better. I recommend you power the middle one in each group.
WHY: DCS sends a digital signal composed of Hi and low volt pulses, the pulses run down the wire to the power drop, a copy goes down each power drop to the track where it again splits and goes both ways down the track.
IF you do not split the track into blocks these signals then cross each other over and over racing around the track. This means the engine is getting many of them out of sync at the same time, The Highs and lows from different parts of the signal get mixed going into the engine and it cannot understand. It's the tower of babel.
Now, with Blocks you will get the signals running to the end of the block and bouncing off the end of the track, these are weaker but still can interfere in some conditions.
The filters snub the signal out. In the case of one filter per drop, they keep the bounced signals from going back into the buss and mixing with others.
Also, A rev L TIU with PS3 engines will make a lot of difference, the signals between them are much stronger. Rev L with PS2 is improved as well but not as much.
Good Luck and feel free to drop into the DCS subforum for more help.