A few things:

1) Yes, the PA Flyer is a very good starter set. Even as my kids have gotten older it's one of their "go to" fun sets. 2) Well, if you get the BT version, you'll never have to worry about the remote breaking. That said, we've had some of the sets with remotes for 5+ years without issue. Obviously YMMV. 3) This is definitely a set you can build off of. To build out, you would need to buy more track, and eventually move to an external power transformer (this comes track that plugs directly into the wall). Then you'll be in business and be able to power more accessories/scenery, etc. 4) Yes, this set should handle small elevation changes.

Differences between the two sets: - The older set has more track (the curved pieces + 4 straight pieces) vs just the 36" circle of the new set - The new set, as you noted, gets bluetooth - The engine and cars got different paint jobs - It does make sense, as Amazon ran a Black Friday promotion with the new one, so they may just have more of them lying around.

Other than that, they're the same thing. The extra track is nice, but not $70 nice (only $22 on Amazon for extra track). Depending on the size of your tree, you may need the extra track to avoid it hitting the branches too much.

If I were to look at an alternative, It'd be something like this the MTH version of the same set. However, for a kid, i think the LionChief remote is easier to use, and while I generally prefer the detail and sounds of MTH trains, I don't think the MTH set is 53% nicer to justify the cost. Also, Lionel and MTH use different track, and while the trains will run on each others track, the two tracks will not work with each other. The Lionel Fastrack is a bit more expensive, but also easier to find used. Lionel switches cost more than MTH switches. Overall, it's probably up to whichever brand you think you'll buy more Ready To Run sets of (and my guess would be that'll be Lionel).

http://www.modeltrainstuff.com/MTH-Rail-King-O-PA-2-8-0-Steam-Freight-Set-p/mth-30-4226-1.htm

Overall, if it were me, i'd go with the later of the Lionel sets and buy some extra track.

Link for extra Lionel track if you need it: https://www.amazon.com/Lionel-FasTrack-Gauge-Straight-Track/dp/B0006KSMHC/ref=sr_1_1?s=toys-and-games&ie=UTF8&qid=1513199837&sr=1-1&keywords=lionel+fastrack