Ace -
I have a similar layout to what space you describe. It's an L-shape that grew from a 4x8. I'm attaching the track plan in case it spurs any ideas. A few notes:
The "upper" leg of the L is the original 4x8 (which is actually 4.5x8). It's a double-loop going up to a logging/mining area, one loop is 2% grade up, one is 2% down. It's basically all circling a large hill/mountain (I removed the grade lines for clarity).
Near the top of the layout, you may notice a switch to nowhere. This leads to a staging area/reverse loop below "ground" level. Also, the whole layout is 22" radius minimum (thus the need for a few extra inches on the 4x8), EXCEPT the hilltop logging/mining area which is 15" - very tight radius, but fine for the little ore cars, geared locos, etc. which serve it. In your world, I imagine switching and smaller 8-wheel diesels would do fine. You're not going to run 12-wheel diesels or longer cars through there, though.
As you leave this area, you proceed through a yard to another loop at the bottom, which represents a town with industries that use the wood/coal from the other area. I model the PRR in the 1920's-40's, but certainly equally applicable to modern era. The yard is not large and certainly makes some compromises from "reality" -- but as another poster mentioned, yards can take up huge amounts of space, especially as you get closer and closer to prototypical. So I settled for having a yard that's not 100% realistic rather than having nothing OR giving over the whole leg of the L to yard...
I used RTS to design this, so it all looks like sectional, though it's mostly flextrack in reality. Also, you'll see some weird "not connected" pieces of track. Assume they're connected - it just wasn't worth the hassle to "force" the software to do it. example - the "town" at the bottom has a siding off the main where there's a station -- it's connected at both ends for "thru" traffic, but the program has no facility for a switch-on-a-curve, so I just left it looking like a one-entry spur...
Best of luck,