Called Service department and parts department for days, left messages, no response.  I'll call the retailer to see what they can do.

Ok...this is disappointing...I have little kids dying to see this thing run around our Christmas tree...how long does it usually take to replace things?  This will determine how much I take this thing apart or keep trying to fix something.

I have not gotten to the granularity of opening up the locomotive to see the motor, and see the continuity of each phase from wheels, to board, etc.  I will try this next.

I can't turn the wheels by hand or by trying to move the side rods.

I have a voltage meter, which i used to see that i have juice in the track...it's more of a battery tester, so I am not seeing a specific ohms reading...but I can back into it.

Let me make sure I understand:
I should use the powerclip, or other power source with wires and touch the train wheels.  Then test the voltage at each stage? wheels, pickup, board, motor outputs?

If I touch live wires to the locomotive wheels, should it the engine turn over?  If I touch the live source, power clip or feelers from power clip to the wheels, I still get nothing...

When you say touch live feelers on opposite sides of loco and tender, do you mean touch one wire on the loco and one on the tender car?  wheels on opposite sides?

I am actually having this exact same issue with what seems to be the same model. 

Brand New Out of the Box: Wonderland Flyer Item Number 90047

All items in the photos above are relevant.  I have tested the track with a voltage meter and it seems I am getting plenty of power in the track, moves up and down with the controller head knob, but I get absolutely no movement in the locomotive.  Just sits completely dead..no indication of movement.