I bought this product for one of my Thomas-The-Tank-Engine addicted nephews as I liked the sound of the "authentic Steam effect" that it claimed to produce. I did not have time to test it myself before wrapping it up, but managed to witness it's use first-hand last week when i went to visit.
When I asked my sister about the toy and whether it actually produced "steam" she replied that it did, and proceeded to show me. She filled up the container within the unit with water, and then handed the control to my nephew (Aged 3), he then proceeded to send Thomas across the living room carpet with what appeared to be actual steam coming from his chimney. I was actually really rather impressed by this as I had never seen this before from any child's toy - although I recall Scalextrix and Hornby may have used similar technology but I had long since grown out of them by the time it came along.
The toy itself aside from the Steam effect is simple enough. It's not particularly fast, nor does it do anything else or come with any other accessories, so one could argue that it's a very basic Radio Controlled device with a Steam gimmick, but I think it's honest enough to pull it off and so I can happily recommend it to anyone with a young child who might show an interest.
Tip: They're likely to ask you how it works but I didn't even know the answer myself!