Rob,
I agree at the moment its pointing to a fault in the Lenz, either a faulty device, or an error in configuration/setup.
Just one detail, you should only see AC volts at the main running outputs. That the shorting test showed nothing, and the LED flashing, does indicate a problem.
You won't see anything on the programming track, save for a very brief pulse of power as programming instructions are sent. An analogue meter should show a needle flick as a pulse is sent, but many digital meters won't respond quick enough to see anything. Alternatively, an LED+resistor over the programming output should flash as the pulses are sent.
If there is nothing in the instructions on resetting the Lenz system back to "factory", and you're certain the settings have power on, then the logical conclusion is "fault".
On the Gaugemaster, in general, if they have a yellow front panel, then they are non-feedback types, so safe for testing. In general, Gaugemaster colour the panels of feedback (bad in this case) types in Red or Black, they also have model numbers ending in "F", such as "DF", or "H" such as "HH".
In the current Gaugemaster range, there isn't anything which is a feedback plus inertia unit (your earlier description was of an inertia type). But their range is smaller than it used to be as there are models I've used which are no longer listed.
Borrowing the Sprog. Ideally, if you can, take the locos to the Sprog owner with their computer, known to work, and check there. Only then actually borrow the device and try to set it up locally. I've known people get into almighty messes with driver files, Windows security settings, etc.. etc.., and when its not clear what is working (or not), adding another non-working device to the equation doesn't help !
- Nigel