The vast majority of railway construction and maintenance machines is powered by compression-ignition combustion engines. The tendency of introducing stringent standard emission regulations for these prime movers, e.g. TIER 4, forces the migration toward downsized units. Additionally, the high price reached by diesel fuel in the last decades demands reductions of the machines' energy consumption in order to maintain the customers' operating costs competitive. Both targets can be achieved by implementing efficient hybrid hydraulic displacement-controlled architectures that reduce pollutants emissions and benefit fuel saving without affecting the system's productivity. For these reasons, this research paper aims at investigating the potentials of a series-parallel hybrid architecture grounded on secondary controlled hydraulic motors and potentially suitable for any railway construction and maintenance machinery. The results demonstrate that the rated engine power can be reduced by at least 35% in the reference application by applying such a propulsion system. Specifically, the high-fidelity multi-domain dynamic model created for sizing, analyzing, and controlling this displacement-controlled layout is addressed. Special focus is dedicated to the rail/wheel interface confirming that the proposed control strategy maintain the slip/spin of the wheels within the desired limits.