It looks like you guys combined to figure it all out.
Based on who the original poster is, I feel confident that this is GCR #4960, taken after a runby on a Lerro Charter.
These are indeed Rail Washers, which are used to clean the sand off the rail so it does not create additional friction with the trailing cars. We use them occasionally when the steam locomotive operates by itself, but not when there is a trailing diesel (they need sand too!)
The dripping fire has a lot to do with the runby. 4960 burns so clean most of the time, in order to make smoke for a runby, the fire needs to be significantly choked down, leaving a lot of unburnt fuel in firepan.
Eric