He is very much...dead!

If you're referring to an AU where everyone is humans, I actually don't have any sort of story framework for how it'd work, I just like drawing engines as humans. :') But if it's just my general headcanons, then yep, he's dead.

Side note re: "Culdee made the story up", my headcanon is that even within the Railway Series books released in the RWS/TTTE universe, the Thin Clergyman also had to soften Godred's tale so as to not potentially upset children. So I can imagine Culdee's driver showing him the Mountain Engines book and Culdee would be like "what" but I'm sure he'd understand why it had to happen.