I'm going to assume that the train set was a DC set and not DCC.
That being said, you connect the green wire to the rectangular switch. The switches (as you said) can be connected together. The red, two wire, cable connects to the male side of the rectangular switch. The other end connects to the AC connection on your controller. Don't connect it to the DC/track connector, but to the AC/accessory connector.
Hope that helps.
Kevin
That being said, you connect the green wire to the rectangular switch. The switches (as you said) can be connected together. The red, two wire, cable connects to the male side of the rectangular switch. The other end connects to the AC connection on your controller. Don't connect it to the DC/track connector, but to the AC/accessory connector.
Hope that helps.
Kevin