What can I say? You get what you pay for.
If you buy train sets, you get toys. If you are serious about getting into model railroading, you must understand up front that it is a rich man's hobby, and a good locomotive will cost you more that a trainset will. And it is worth it.
A lot of people buy the cheaper trainsets when starting out, and then get frustrated when the brass rails accumulate oxide and no longer pass electricity to the engine, or when the engine craps out, or when they discover that not one of the items in the trainset they bought comes close to being accurate to a real prototype. If your're buying it for your kid, don't sweat it. He won't care. If you're buying it for yourself, don't bother with trainsets.
In the latter case, do some reading. Decide what era you want to model, what railroad you prefer, and go from there. Find a good trackplan, read up on using flextrack, and buy nickel-silver flextrack to lay your trackplan out. Buy a good locomotive — I recommend Atlas, Kato, Stewart and Proto as brands to buy with confidence. You can often find bargains on eBay. Build up your rolling stock one car at a time, with an eye to acquiring models that fit teh period of your prototype. Look into couplers — Kadee #5 are pretty well standard, unless you want more scale accuracy. When you buy a car, replace the wheels with metal wheelsets. Plastic wheels deposit lots of crap on the rails, don't roll as well, and in the long run sticking with metal wheelsets will save you much grief.
One common beginner's mistake is building a layout with too much track. I promise you, your first layout will be a disaster. You're going to put up a 4x8 sheet of plywood and load it up with too much track. There won't be room for industries, your sidings will be too short, there won't be any staging, your passing tracks will be too short, and in a year you'll hate it. That's normal. We've all gone through that.
Go find a copy of John Armstrong's book "Track Planning for Realistic Operation", published by Kalmbach. It is a classic, and well worth the purchase price. Read it. Then read it again. Keep it in the bathroom and read it everytime you have cause to sit for a few minutes. It is a wonderful book, and if you understand what he is saying, you will save yourself much grief, and not a little money, by gaining an understanding of what a good layout includes, and what it doesn't.
You're also going to run across people who insist on imposing their standards on you. Ignore them. This is your hobby, and you set the rules. If they don't agree, that's tough. You're doing this to please you, not them. If you're happy with what you've done, that's all that matters. The only opinion that matters is yours.
And remember, model railroading is a hobby, an activity you pursue to eliminate stress, and from which to to get enjoyment. If you find you're getting stressed out over how many rivets are on the plate behind the sand dome, or whether the door latches are the right shape, it's time to step back and remember that this is supposed to be fun, you can only do what you can do, and while you can and should strive to make the next model better that the last one, there's are compromises with every model. Do your best, and don't pay any attention to people who say it isn't good enough. If you're happy with it, it's a great model. There will always be better modellers than you, and if you get hung up trying to best them, you'll spoil the enjoyment that you can gain from modelling.
And remember always, it's a hobby. It's there to be enjoyed, so enjoy it, and have fun.
Cheers
Scott Fraser
Calgary, Alberta