A couple of other things you can try:

1)Check the wire from the antenna to the receiver, if its unshielded, maybe slide it into a carbon fibre pushrod case, this may give you a bit of RFI shielding, perhaps wrapping it in foil may also help, if you don't have a pushrod, or its awkward.

2)Experiment with the antenna grounding. If the antenna is connected to the locomotive with a metal to metal contact, try running with the two insulated so that the mount isn't in electrical contact with the locomotive, or visa versa if they are already insulated.

3) If all else fails, why not solder a proper length antenna back onto the receiver, and do what Mike East mentioned, coil if carefully around a non-conductive core, and just leave the end out, perhaps running it under the locomotive inside of a pushrod guide?

On a side note, using aircraft frequencies for a ground based model is not kosher with the FCC is it? Shouldn't your radio be using terrain frequencies (75 MHz)? Excuse me if 40 MHz is okay for ground, it just popped into my head.