I'm afraid these have a bit of a reputation for being unreliable - a major UK importer is forever listing "faulty" ones on eBay at reduced prices, so they must get quite a lot either returned or simply not working when tested before sale. You mention having tried everything, so I won't ask stupid questions about batteries in the handset..... I would suspect a faulty transmitter handset.
You say your Wife bought it as a second-hand item - was it a physical cash purchase somewhere like a car boot sale, or online? If it was bought online then you should have some sort of recourse from the seller, if it was described as working.....?
If you can't get it working, then depending on how much was paid for it then it might be worth stripping out the RC gear and replacing it with a simple "proper" RC setup from someone like our own PhilP on here, or some Fosworks gear as JonD has been putting in some of his locos recently - have a quick trawl through the "Battery power" threads for somne ideas.
Simple, effective, low cost and easy to install just add batteries of your choice. Lights can be wired across the motor terminals so that they are directional (just need a resistor to protect the LEDs)
If I remember correctly, there are two buttons in the cab, one makes it run autonomously and the other changes the RC frequency. I find mine only responds properly with a good strong new battery in the transmitter.
I was lucky with mine it worked ok, bought in the early days from the USA before they were imported to the UK. Mine has been hacked and the body is now part of my Mallett with another boiler added. The chassis sits on a shelf while I ponder what to do with it. All tne RC and Control gear sits in a box in the loft taking up valuable space!
To be honest though the control was pretty poor unless you wanted to just run it in circles, sound a complete waste of space cycling through lots of sounds in an illogical way and the lights far to blueish in colour. That was why I was happy to rework it. Though I suspect with a strip out of exisiting gear and a completely new RC and Sound setup it could be a really useful engine.
Thanks for all your replies. I bit the bullet and stripped it replacing all the radio gear with 2.4GHz stuff I have from my other models. Happy to say, really pleased as a starter loco. I am sure that as other stuff comes up I will be interested in it. Good job I don't have to go through the house and can head straight for the shed!!