Currently red diesel does not need to comply with "low" (50 parts per million) or "ultralow" suphur (10 ppm) and therefore can contain up to ~2000 ppm (0.2% by weight). Red diesel also tends to be of a lower cetane value, which basically is a measure of how efficiently the fuel burns. Train fuel does not have to comply with low sulphur legislation currently, though whether the fuel is literally "red" or just a low grade, I don't know, others may.
The directive you may be referring to may be this (the section regarding rail is pp13-14), which may or may not have been brought into law:
http://www.dft.gov.uk/consultations/closed/consuleupetroldieselreqs/pdfeupetroldiesel.pdf
This states that by 31st December 2011, rail equipment should use 10 parts per million (ppm) sulphur diesel, i.e. ULSD. Perhaps this has been brought forward to 2010 as you suggest.
Sulphur levels in fuels affect the amount of sulphur oxides emitted but more importantly the performance of emission control catalysts. Absorber/reduction catalysts for nitrogen oxides (NOx) are poisoned by sulphur, as are diesel oxidation or soot filter catalysts such as those soon to be mandatory in new diesel cars and trucks. Protecting emission control catalysts is the main reason ULSD was introduced.
Currently emission control catalysts are not mandatory for rail engines, however I believe MTU offer an aftertreatment option, though I don't think the new HST engines use them for example.
My point is that the introduction of low sulphur diesel is probably an enabler for the introduction of emission control catalysts in the future, particularly NOx control catalysts. Rail engines will be forced to use these at some point in the not-too-distant future.
Hope that's not gone too far off topic!