a great engineer can only participate for a given number of hammers towards a wonder. Same as lighbulbing and beakers for every GP: you can't usually lightbulb all education with a scientist.
For the engineer, there a base (something like 500 hammers) and a bonus, dependant on population. The number of beakers of lightbulbing depends on whole population, but I'm not sure for the engineer building, if it depends on whole population of just the city's population. So basically, they can't complete late-game wonders by themselves.
Oh, and you can't use an engineer for manhattan project.
The complete formula (for a normal game speed) is:
Maximum Great Engineer hammers = Base hammers + Population hammers
Base hammers = 500
Population hammers = 20 per population point
in the city
Note that population points only count
in the city you are rushing the wonder in.
So for instance, if you rush a wonder in a city with 8 population, the Great Engineer will contribute a maximum 500 + 20*8 = 660 hammers. If the wonder costs less than 660 hammers (eg the Pyramids = 400 hammers), you get it built in 1 turn and any "extra" hammers disappear (eg the 260 "remaining" hammers from the Great Engineer are lost). If the wonder costs more than 660 hammers, then you get exactly 660 hammers towards the completion of the wonder.
You can see that it is most efficient to use Great Engineers for expensive wonders in large cities. For instance, a population 20 city will recieve 500 + 20*20 = 900 hammers towards the completion of an expensive wonder (like the Statue of Liberty at 1500 hammers), whereas a population 2 city will recieve only 500 + 20*2 = 540 hammers towards the
exact same wonder.
Note that the formula scales with game speed, as do the wonder costs. I believe the values are as follows:
Epic:
Base hammers = 750
Population hammers = 30 per population point
in the city
Quick:
Base hammers = 250
Population hammers = 10 per population point
in the city
Marathon:
Base hammers = 1500
Population hammers = 60 per population point
in the city
Of course, the wonder costs are also scaled with game speed, so Great Engineers do not get any more useful in terms of percentage of hammers contributed. For instance, rushing the Statue of Liberty on a marathon game speed in a population 20 city would yield 1500 + 60*20 = 2700 hammers,
but the cost of the Statue of Liberty on a marathon game speed is
4500 hammers. So the percentage of hammers which are contributed toward the wonder remains the same between game speeds. (See for yourself: in the earlier example for normal game speed, the Great Engineer provided 900/1500 hammers for the Statue of Liberty in a population 20 city, or 60% of the total hammers for the wonder. For the marathon example, he provides 2700/4500 or 60% of the total hammers for the wonder again.)
I hope that helps to clarify the situation.