So it looks like I-95 won't be relocated.
I don't see how they make an interstate-to-interstate interchange between I-95 and future I-42 without relocating I-95. That railroad paralleling I-95 is just too close, as well as expensive ROW to buy.
Could they claim a railroad under eminent domain or something?
Yes, but it is expensive. In the '80s a portion of a Virginian/Norfolk & Western line near Gilbert, West Virginia, was claimed to build the R. D. Bailey Lake. The lake was planned to flood the line, so a new line was built by the government above the high-water line.
When Jordan Lake was built south of Durham (completed in 1974), the Corps of Engineers rerouted a long section of the old Durham and South Carolina Railroad, then part of the Southern Railroad I think. Guess what: in less than ten years the brand new railroad was abandoned. Eventually NCDOT bought the ROW and today it is a section of the American Tobacco Trail greenway.
I suspect that some folks got confused between the planned I-42 connection to I-95 and the proposal to reroute I-95 at a smaller exit nearby, which was partly due to the nearby CSXT mainline (former Atlantic Coast Line).
For the record, roadway/railroad construction is "expensive" in general. The bigger issue is that most state DOTs have a hard time working with railroads because of the difference in agenda. Large projects take a great deal of "energy" from the railroad that is better focused on railroad line capacity (meaning the number of experienced railroad designers from the various departments, in particular track, signals and B&B=bridges and buildings). One of the hardest things about rerouting a mainline railroad is that the "bypass" will almost always be longer and somewhat slower than the straightline route that needs to be relocated. It doesn't sit well with railroaders (me being one of them) when the DOT wants to speed up their traffic by slowing down the railroad traffic (as well as diverting attention from more important railroad projects). Once that issue gets addressed, everything else will fall in place.
On the flip side, state DOTs see the railroad as immovable and also view the cost line item as something that can be eliminated from the project. And that plays right into the railroad's hand.