"I have a S scale locomotive that has a 3 amp stall current (approximately 4 ohms resistance). Normal running current of the loco is 0.6 amps. If I add a 2 ohm resistor in series with it, stall current would be limited to 2 amps allowing the use of a HO scale decoder (with BEMF). I recognize the top speed of the loco would be reduced but the decoder BEMF would still give good speed control. Also, the resistor needs to be 10 watt (2A X 2A X 2 ohm).
This seems like a less expensive way to go than using a larger more expensive O gauge decoder. Are there any flaws in this logic?"
Using Resistor(s) to limit the stall (peak) current of the motor might work as long as you reduce the motor current to working current range of the decoder. I would use T1 as being the most robust of all our decoders. There is something that you need to be a very careful with - if you lower the motor current too much it might not have enough power to run the locomotive with a load. The performance of the BEMF should not be affected by the use of resistors.