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Many model railroaders like to recreate their childhood toy train layouts while others wish to simulate in a small scale real railroads' look and feel.  Toy train layouts generally have lots of track and accessories filling the available space and sharp curves.  Operation is mostly watching trains run and operating the accessories. 

Scale layouts on the other hand have less track and more buildings and other scenery elements with larger radius curves.  Scale layouts often simulate real railroads by switching freight cars to and from industries and making up trains.  Of course watching trains run can be just as enjoyable on a scale layout as on a toy train layouts.  No model railroad duplicates an actual railroading environment either in size or operating environment.

Today many layouts are combination, using 3 rail track but with highly detailed rolling stock and larger than toy train radius curves.

References:
http://www.layoutvision.com/id13.html
http://www.ldsig.org/


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