Check out my response to "Quick Question" below.
When it comes to locomotives, it is well worth spending the money to get a good one. It baffles my why manufacturers, who one would think would want to draw people into the hobby, peddle cheap "trainset" locomotives that are unreliable and inevitably frustrate newcomers to the hobby. They're shooting themselves in the foot, driving people away by offering cheap junk that just puts them off model railroading.
By all means, do what you can to salvage your purchase, but in future stick to the better manufacturers — Atlas, Kato, Proto, Stewart, Genesis, among others. Avoid Bachman and Life-Like (now Walthers) "trainset" locomotives in favour of better quality. It will greatly increase your enjoyment of the hobby.
Start reading — magazines, on-line articles, forum posts, etc. the more you read, the better informed you are as to accuracy, reliability, and relative cost of various locomotives (and rolling stock). You are then better able to make a good choice when you go to buy your next locomotive.
And as others have said, beware of eBay. Don't buy from there unless you know clearly what it is you're buying. Initially you are much better off to make friends with your local hobby shop, ask his advice on your purchases, and support him as he supports you. It may cost a bit more at face value, but if he can steer you clear of one bad purchase, it more than makes up for the few dollars more you might pay to buy from his shop. And these days, brick-and-mortar hobby shops need the business.
Cheers
Scott Fraser
Calgary, Alberta
Good luck with your