Gold inlay is done by undercutting the metal and fitting expanded gold into the cut.
I believe the Henry is made of brass. It may be gold plated, but I doubt it.
It is a gold powder mixed with some kind of liquid that you rub into the lettering and wipe off the excess. Is it gold or just gold colored ? I would imagine it is gold colored, I could be wrong
I bet it is a Bonanza Gold kit. That stuff is really easy to apply. Just follow the instructions that come in the box. You'll get a small bottle of liquid, and a small bottle of gold-toned powder.
Doesn't require much heat to melt Lock-Tite. Mind you, that fake gold(real gold runs a bit over $1300US per ounce) is an unknown material. Most likely just paint.