Something like this perhaps? http://www.s-cab.com/ (although not specifically related to Marklin Gauge 1). There was also quite a comprehensive article in the magazine "Model Railroader" a couple of months ago.

I have run LGB and Marklin 1 locos on the same track I was running Roundhouse live steam engines. You are correct in considering the oil issue but the steam locos should not be pouring out oil at an alarming rate. My set-up was out doors and the biggest issue regarding the steam locos was making certain the fire was set properly and the right amount of pressure was loaded before starting the loco, I started the steam locos on a connected but dedicated stretch of track to get the oil and water out of the cold cylinders. Generally speaking the locos ran clean when they are hot and not drained of steam (using too much and the loco stalls). I only had issues when guests tried running the locos and did not grasp the concept of live steam. I had a few spills but was able to wipe them up quickly. The Markelin 1 electric locos could power through all but the worst spills. Batteries are a real pain, they always run out when you are at a critical moment! I would try it without batteries and see how it goes.

Personally, I think that this is a great idea. Running wires all over the yard has little appeal for me..

The problem with Lipos might the voltages.. Because they come in "cells" you jump from 11v to 14.8v.. From memory the jump is 3.7v per cell set.. I use them in my 1:72 scale Type 45 destroyer (2.2m long with twin engines and weighs 20kg) - it runs for hours on the Lipos and it does not have the weight problems of equivalent capacity lead/acid batteries..