At the time they were available for sale they came in a DC or DCC version. None of the decoder manufacturers ever came up with an after market decoder for this one so if you want to add DCC to one it's going to be a wired decoder. I chose the small and reliable TCS Z2 with functions rated at 60ma driving 3 LED's should be no problem.
I drew up this schematic to show these connections.
I got my 3mm common anode, 2 color ( red / green ) LED's on line from LED-Switch, www.led-switch.com. Their item number was L033RGDCA. It was only $1.50 for a bag of 10 plus shipping. They are worth checking out anyway as they have quite a few good items for model railroaders.
The method I use is shown in this photo. If it lights with the + side of the 9 volt battery connected to the center, then it's common anode. Don't forget the resistor !
There will also need to be some minor modification to the frame so start by fully disassembling the locomotive, placing all the small parts in a plastic bag. Always put the motor assembly in a separate small plastic bag so no small metal objects will get into it because they are attracted by the motors magnets. But before putting the motor away see the step below.
Check both and use adhesive if needed. I used the E6000 product that I have mentioned in other posts.
Three diodes and one capacitor will be removed. The LED's with 3 leads will to be replaced with the common anode ones. The LED's with the heat shrink need to be swapped from one end to the other.
One circuit trace needs to be cut.
The modifications required on the original LED light board are all shown in this photo.
When installing the new common anode LED's it is important to keep the flat edge of the LED facing the same way as the old one was. On this type of LED, the flat edge indicates the side for red.
This photo shows what the decoder should look like after this step is completed. Tin the ends of all the wires, this will keep those twisted ends together.
Test fit the shorter PC board, it should fit tightly on both sides. If it is loose on either side, remove the board and tap lightly a few times on the top of the frame at the spots indicated by the blue arrows. Re-check the fit of the board. Go slowly and repeat as many times as needed until satisfied that the board is making solid contact with the frame.
Test run in both DCC and DC modes to verify the lights are all working the way they are supposed to and are synchronized with the direction the locomotive moves.