I have really enjoyed this thread and have been tempted to add my input but the info has been such that it was best left alone, thanks for the effort and the EXCELLENT info!
I would like to say that the parts about prep has been spot on, prep will not only "make or break" a good job it can and all too often does ruin not only the job but the gun itself! I have seen several guns absolutely destroyed (appearance) by ham-handed preparation and the end result was a finish that was actually worse than what they had when they started. The one that has gotten me to comment now was one that I saw just a few days ago, this was a pitiful looking model 97 Winchester Trench gun that had been stolen and with the thief thinking he had been seen leaving the house he had buried this fine old shotgun under some leaves beside the road. He was right, he had been seen and was caught the next day but it was another 24 hours or so before he fessed up and told where the gun(s) were hidden. After about 48 hours under those damp leaves the gun(s) had a light coat of surface rusting, I looked at that shotgun and told the owner I could see only light surface rusting that should clean up with nothing more than steel wool and maybe a light polishing and quoted him a price to do this and to hot blue the gun. Here is where things went sour, he decided he would just do the job himself and ordered some Oxpho-Blue from Brownells and then he set about sanding off the rust. When he brought it by a few days ago to show me the job he had done I could clearly see every single spot where the rust had been even slighted pitted, I saw this gun before he worked on it and I know there was no pitting that would not have cleaned up but had made the usual mistake of concentrating directly on the rust spots thus leaving "dips" or low spots that could easily be seen even through that somewhat dull cold blue finish. That wasn't the worst of it, all of the corners/edges were rounded off where he had just sanded over the entire gun without regard to these very critical areas probably with a soft sanding block or just by palming the paper. Previously crisp stampings were now "soft" and had that all too common smeared appearance that is the hallmark of an amateur prep job, even he could see that something wasn't quite right but he thought he could get me to hot tank it and fix the problem! There simply is no way to fix this kind of error, once that metal is gone there is no practical way of repairing it short of a VERY expensive professional restoration usually reserved for very special firearms.
Prep is THE most important step, heck it's 90% or more of the entire rebluing job, but it seems to be the least covered in these types of discussions usually getting only casual mention -if even that. The well said warning at the beginning of this thread about using power sanding belts/tools is good advice indeed! In fact avoid using power tools as much as possible and this usually means only for buffing to high gloss if a shiny finish is desired, unless a high gloss hot blue surface is the goal I see no need for power tools at all as these can ruin a gun PDQ!
The things to avoid are,
DON'T dwell on a small area, concentrating on a rust pit or small area of pitting will result in an uneven surface with dished out shallow areas that will stand out like the proverbial "sore thumb" after the job is finished. The proper way to do this is to block polish the entire area as much as possible and resist the temptation to even lightly concentrate on any one pit or small area, NEVER "finger" a pit or small area by using the finger tips on the sandpaper. A dished out or shallow spot will look worse (much worse!) than a small pit left in the surface so sometimes it's necessary to leave a few pits rather than make things worse by trying to remove 100% of the surface damage, remember that pit is a spot where the metal is simply gone, it's not just a blemish it's a hole down into the metal and the entire area around the pit(s) must be removed to a depth equal to the bottom of the pit in order to eliminate it. Unless this can be spread out over a large area the result will be that ugly dished out appearance.
STAY AWAY FROM EDGES as much as is practical! Approach edges and corners with EXTREME caution and never allow sandpaper to go over a sharp edge or corner unless it is backed by a hard sanding block and that block is supported well back from that edge/corner! When sanding over an edge or corner the paper will have the tendency to "rollover" these edges as the support is lost from the block extending over the part, this is very difficult to control unless you pay CLOSE attention and it only takes a very few careless strokes to do serious damage! Of course it's not always possible to use a hard sanding block in tight areas or any uneven surface so in those cases use extreme care and polish only up to the edge trying not to go over, this is usually time consuming and the hardest part of the job but it's time and effort well spent.
STAY AWAY FROM LETTERING/STAMPINGS as much as is practical! If rust is in lettering/stampings it can be removed by using a pointed tool, I use a carbide scribe, then the area surrounding the lettering/stampings can be polished with the hard backed sandpaper but be careful here. If there is pitting in these areas of lettering/stampings then a decision will need to be made as to how much the depth of the lettering/stampings should be sacrificed vs any pitting, usually a compromise is made but a few light pits near lettering/stampings will not look nearly as bad as lettering that has been nearly sanded away.
BE CAREFUL WITH THAT BUFFER! If a high gloss finish is the goal (this doesn't apply to rust blue) then buffing is the last step and here too disaster lurks! It's surprising to some folks just how fast even a buffer with those soft wheels can round off edges and cause lettering/stampings to smear so just as with polishing with sandpaper be EXTREMELY careful when buffing near edges/corners or other delicate areas.
All of the above has been assuming that some rust has to be dealt with but it's just as important even if there's not a speck of rust on the gun, above all else maintain those crisp edges/corners/lettering! I have seen several guns ruined, or at least noticeably damaged, by rounded off edges and corners even when the intent was just to restore areas of worn bluing.
Not trying to highjack this thread and the OP is to be commended for his efforts and the excellent information he has so kindly provided. It's just that so many otherwise nice firearms have serious refinish flaws that need not have happened and while there is much discussion to be found on the various types of bluing available to the home refinisher, and the application of these processes, all too often the most important step is hardly mentioned if at all. Prep is the key to a nice finish, the prep is actually the job itself and is what people see in the finial product while the actual blued surface is just the icing on the cake!