The Geotrax Train system by Fisher-Price is pretty great. You can start to use it with two-year olds and the trains remain interesting quite frankly into adulthood. (Heck, I love playing with them, too.)
The problem is that they are not making very good pieces for it anymore. They have stopped making most of the really interesting ones. So, if you have a toddler and are considering investing in these, here is what you do.
Step 1: Buy the basic Remote Control Timbertown Railway at any standard retailer, toy shop, etc.
Step 2: Assess your toddler's reaction. Does s/he seem transfixed? If so ...
Step 3: Leave the retailers behind and go to the second-hand market. Consignment shops, Craigs list, Ebay, etc. Sniff around first and get a feel for prices. Then start buying. This is how you get the really cool stuff: the big sets of tracks, the clock tower, the mountain, the funky suspension bridges, the special tunnels.