Hi Fish...
Welcome to the Gauge!
3x4 is awfully small for a loop of HO track. That means you will be running 15" - 16" radius - allowing for a bit of room around the edges. 40' cars should be ok with that (other considerations not withstanding - overhang, etc), but a 60' engine - maybe a problem. Might be ok if it is 4 axel, but bigger 6 axel will most likely pose a problem.
(Of course, as I am saying this, in another thread I am asking what is the smallest possible radius for flex track - I want to do an operational diorama no bigger than 2x2!). See
http://www.the-gauge.com/forums/showthread.php?s=&threadid=7128
Could you go to 4x4 feet? That would allow you to run 22" radius circle - not too exciting, but a good place to start for future expansion.
Future expansion may be the way to go - is it possible to design this as the first half of a 3x8 (two 3x4's joined on the 3' edge)? The modular approach is very popular, and well established. If you build to published standards (see
www.nmra.org , and others) it will be able to connect to any others built the same way - there are lots of modular clubs around.
The other advantage of the modular approach is now you don't have to worry about what to get for birthdays and next Christmas!
There are lots of small track plans at
www.gatewaynmra.org . They also have lots of tips about building small layouts (4x8 or less).
Good luck. Let us know how it works out, and don't be afraid to ask more questions - the Gauge has a great bunch of people.
Andrew
EDIT: Here is a link to one of my favourite modular railroads. It is two pairs of modules, with each module being 2x4 feet - total when everything is hooked up is 2x16.
http://www.geocities.com/fundynorthern/MainPage.html