Hey, Skyrider, thanks for your post.
The trouble turned out to be in the code that I had been given. The developer sent me some different lines, and they now work.
I'm still using the .conf structure that Dreamhost recommends, as documented in the WIKI. Essentially you create a nginx directory under the username (e.g. /home/myusername/nginx/maps.wildtroutstreams.com/). Then, for whatever .conf files it finds, it adds the text they contain to the default server configuration. You don't need to duplicate the root command, since that's already in the default server configuration (in fact it gives you an error if you try).
Being a complete Linux novice, I feel more confident keeping this as Dreamhost "standard" as possible. However, one important consideration is, you do need to uncheck the Dreamhost managed box for web servers on the web panel. Otherwise, it ignores the .conf file. The WIKI doesn't say that, but customer support did.
Thanks to your help and some other folks in this community, I THINK I'm now off to the races. Thank you all!