Since Fullerton is my hometown, I can probably offer some clarity on this. The roundhouse idea first surfaced in the late 1990's about the time Fullerton Railroad Days began. A group was formed who then persuaded the City to construct the private car tracks adjacent to the platform.

I believe the initial thinking was that private car owners would pay to store their cars there and it would generate revenue to help further the goal of a museum.

A number of folks pointed out that the rent revenue would not amount to much, and that PV owners would want to store their cars at/near LAUPT to avoid having to pay BNSF to move equipment back and forth between LA and Fullerton in freight service.

All of those concerns fell on deaf ears. Over the next few years, a number of ideas were put forward that made no political sense or were physically impossible.

At least one idea proposed closing part of Santa Fe Ave, destruction of a sorely needed multi-level parking structure, and using eminent domain to take out some well respected businesses.

A different proposal designed to circumvent those concerns showed a track curving so sharply to the north that it would have been impossible to implement on a model railroad. 

There was back then and remains today a strange disconnect between the supporters of the railroad museum/roundhouse and the railfans who frequent the station. With minor exceptions they are totally different crowds of people who don't know each other.

The majority of museum backers sprung up out of nowhere and might not fit the definition of a railfan by railfan standards, if that makes sense. 

It's actually sad because the museum supporters are a good bunch of well meaning people, and you have to admire their optimism. I just don't see this going anywhere.