Compromise . . .

When the Northwest Railway Museum (operating the Snoqualmie Valley R.R.) was running steam, they heated the coaches in winter using baseboard radiators and a steam line from the locomotive. I don't know how authentic that would be on D&RGW passenger equipment, but it would fit in better than a propane unit and be cleaner and safer than either coal or propane.
The Snoqualmie Valley is a standard-gauged operation with a shorter, relatively straight and level route, so I may well be comparing apples and oranges here. As a tangent to the above, the museum put steam operations on an indefinite hiatus in 1990 and diesels cannot provide steam heat, so the quality of passenger service actually declined when they sidetracked Mallet #11! Furthermore, they took an immediate and considerable hit not only in publicity but also in bottom-line ticket sales. There may have been other factors, but the saga of the Snoqualmie Valley is the one I cite most frequently when asked to prove that real steam does make more money, even with the added maintenance and operating costs.