Hmm. To answer your question, "Is the .38-40 an effective deer round?", the answer is No. Yes, it will kill a deer out to 100 yards from a rifle, with a perfectly placed shot, but that does not make it an effective deer round. It makes it a barely adequate deer round. Even when it was first invented, it wasn't sold as a deer hunting round. It was an all purpose, light recoiling round, for saddle rifles, that might be used for deer in a pinch, but certainly not on a primary basis.
Think about it. It was a bullet under .40 caliber, being propelled by only 40 grains of black powder. True hunting rounds were using a minimum of 70 grains, and generally alot more.
Regards,
Mannyrock