In fact, I believe for a lot of engines, the mechanical energy rarely is used directly to power wheels -- it usually (for diesel-electric, for example) is powering a generator that then is feeding electricity to motors + wheels.
So, maybe not such a stretch to take the power/electricity off to other purposes?
The power generation is fundamentally the same as in marine purposes, too. In fact, the modern engines such as the EMD 710 or GE 7FDL, often come in non-mobile stationary/marine operation configurations for these purposes.
The whole point is to use the alternator + electric motors as a CVT basically. You want the engine to be able to use it's maximum power at any given speed. The amount of gears you'd need for a mechanical transmission for the big freight locomotives would be absurd.
Diesel-hydraulic was also tried for a while but was largely unsuccessful. For special applications, like maintenance equipment or moving things in a railyard, you can still find some diesel-mechanical and diesel-hydraulic equipment.
If a freight train stops, depending on its length, it must reverse to add slack between cars. Then it starts by effectively pulling each car one by one. You can hear it as a bang-bang-bang if you're nearby, depending on the coupling method between cars. If a train loses momentum on a hill, it may have to reverse and start from the bottom.