30" is very tight to turn around an HO scale train, N will fit nicely. You can do HO in a radius that small, it's just not conventional. Preformed (sectioanl) track is not available in that tight o fradius for HO, but is for N. HOn30 is basically HO running on N scale track, so it would work as well. In as sense, HOn30 is a more advanced scale, but if it's what you want, I say go for it, and we'll just have to bring you up to speed faster

HOn30 is very well fitted for backwoods, logging, mining, plantation and smaller, light weight railroads.
The blue foam for the mountains would just be cut from the same foam you make the layout from, 4 X 8 (48" X 96") sheets of insulation. If you are really crafty, you could maybe use 1 sheet for the layout, 48" x 30", which leaves 48" X 66" of the foam. You could make hollow doughnut shape rings that stack up to form the mountains, and perhaps need to buy only one sheet.
Yes the software is free, on the left under "brouse", it says "RTS Download". You do have to register, but it's worth it. You can do HO or N scale layouts with it.
http://www.atlasrr.com/
If I put two s's in atlas, I sent you the wrong way, sorry.
for the sand, just some tan latex paint would do, or perhaps some really really fine sand glued down. It also depends on the "water" you use, because want to use something the water won't dissolve. You may wish to experiment with whatever you do on some small scrap.