It was smart of the designers to incorporate the on/off toggle so that it can be used for free play (gears disengaged, rolls freely, won't damage the motor) as well as powered play (forward and reverse).
The only downside is that it will have trouble on sharp curves (runs off the track or gets stuck) because of the long wheelbase. But as long as your tracks have broader curves it will run fine.
Overall this is a great way to bring life to wooden train sets.