Like all post there is about 100 discussions going on at the same time so To answer the rag problem I always spread them outside to dry and then throw away or you can put them in a bucket of water. Why buy an expensive flammable locker. Do not get that one. Unless you are storing flamable liquids in then go for it.
OP question, Any way you want to apply is fine. Find something you are comfortable with. I do as Kevin does and always dip mine in Danish oil. I do not like BLO alone. Danish oil gives a nice luster to the project.
Would get locked up here in NJ if burned things like that so that is out here.
Paper shredders, buy a cross cut paper shredder and I dare anyone to try putting that together. If they have that much time on their hands, go for it. Just as easy to get info from computers or snatch out of the air today.