Just came across this post, and wanted to share some of my own experiences.
Last October, my family (wife, 16 month old (at the time) daughter) and I took the train from San Antonio, TX to Ashland, VA, changing in Chicago and DC. We splurged for a bedroom both ways, as we felt that having the extra space (both room and berths) and the attached restroom would make for a conducive travel experience for our little one.
Overall, things went rather well. Our daughter loved being able to move around on the train, and we found that in the bedroom if we folded up the swivel chair, she had plenty of space to make a little play pen for herself, and to alternate playing at the mirror with climbing on the couch to look out the window. We didn't have any issues with her sleeping (she fortunately sleeps through the night herself), as we found that there were plenty of room between the berths for all of us. (We can take any specifics as to what we packed and such offline if you'd like to continue the discussion) For meals, we were asked to have her on our lap, which was fine, and because she was under 2 and not ticketed, she was not eligible under the sleeper meals in the diner, so that's something to be aware of. That was fine by us, as she was able to eat some things from our meals that she liked, plus we'd packed plenty of food and snacks for her in the room.
We cloth diaper and had started toilet training using the Elimination Communication method, so with the attached restroom, we were able to get her to us the toilet (with a seat adaptor we brought) much of the time, and then were able to use the shower to wash cloth diapers (that were changed on a changing pad on the floor, DA, so not leaving any sort of an impact to other passengers) and have very little waste. We did tip generously to both the dining car staff and SCA, because they were all very accommodating and loved interacting with our little one.
I think the age we took our daughter is about the youngest I'd go overnight on a train, as I'm very self-conscious of disruptions to neighbors/other travellers (which is why I would be hesitant to fly with her), as she was reasonably able to control her emotions, and we were able to accommodate her schedule and needs to avoid any tantrums and outbursts. I agree that it would be unique with each child to ascertain their comfort at new situations, but in general, I think if you're willing to be attentive to their needs, it's certainly doable.
~ ATE