Would you get a combat bonus, for mine-fields, trenches, earthworks, that kinda thing? Players have always used "combat" engineers in SMAC and CivII near their fronts to make their attacks easier, why not include them in armies as well.

+1 for hero
-3 for fighting against dragon
-1 for fighting against evil units
+1 for catapult when attacking city
+ 2 morale for champions

You get the idea.

These bonuses would offset each other and the result would be the combat modifier for the battle.

Since WWII engineers have always followed the armies, not just building supply lines, but also doing demolition of bridges for retreats, forging rivers, etc. Engineers in the Gulf breached the sand berms with water cannons, cut lanes through the Iraqi minefields and bulldozed over infantry trenches. The engineers increase the effectiveness of attacking armies/units. For these reasons, an engineer/worker added to an army should give that army some kind of attack bonus at least. They shouldn't add attack value on their own, just make the army itself more effective.

You could allocate distribution of production between city improvements and terrain enhancements.

That, however, doesn't account for roads, railroads, etc. outside a city radius, as I have just realised. Hmmm.

Nah, cancel that idea.

Here's what I reckon. Keep the current configuration of Settler unit which can found cities, build roads, mines, fortresses and irrigation, but none of the modern enhancements. It is then replaced by the civilian engineer, which can do all of the same plus construct the railroads and farms and whatever other new terrain improvements Civ3 offers that are off limits to ancient settlers. The combat engineer, however, is required for the construction of military installations like airfields and modern fortifications (to replace the ancient fortress). These new fortifications would consist of cyclone fences, razor wire, hardened bunkers, minefields, guard towers and machine gun nests to make life hard for both modern infantry and tanks alike. This combat enginerr would also be able to help out with civilian tasks like roads, repairing damaged structures (if Civ3 does include hitpoints for city improvements) in times of need, as they do in real life.

I don't think that there's enough differentiation between the two ideas to require a two different unit. I suggest merely that the regular engineer unit (super-worker as you've called) just take on an extra combat bonus when included in an army. A combat engineer would have no attack value of its own, its just gives a combat bonus, a % attack bonus or something of that order.

I think there should be a separate millitary engineer unit, they could build some things much quicker like pontoon bridges (with special bridge laying trucks) and maybe come with JCB diggers and heavy machinery for building trenches, destroying fortifications , good for pillaging
(exploding buildings too) and have special abilities - could lay AND diffuse mine fields.
Near here in Colchester theres a bomb disposal unit.. Bomb disposal could be another mil.engineer ability, for preventing terrorism (stopping spies/terrorists by defusing their bombs)
And they could be able to sabotage units, and set booby traps (like in the vietnam war.. though this is complicated)

Admiral Pete