Hi w22w and welcome to the MRF.
As others have said, there should be no problem installing DCC in N Gauge steam locos.
I have 14 GWR steamers (Dapol, GF & Peco) ranging from small 0-6-0 Pannier Tanks to 4-6-0 Kings and they are all 'chipped' for DCC. I admit that it is not possible to completely hide the chips within the boiler or tender of smaller locos so they are generally fitted into the cab space. If this is done properly, however, by fixing the chip up onto the roof of the cab, for example, it is not too prominent and by adding crew it becomes even less so.
Being new to both N Gauge and DCC I had my locos chipped professionally by Digitrains who's website is at http://www.digitrains.co.uk/
but, having now seen how it is done I think I will probably have a go myself on any further locos I acquire. If you give Chris a call at Digitrains I'm sure he will be able to help.