I usually tape off the binding, but you almost always still have to do some scraping. But the only time to use dyes is if you are doing sunbursts or working with really fancy maple. For that guitar, you really don't need to go to the trouble. Spray your sealer, then spray any color over that in a lacquer coat. It could be either transparent, or opaque. A nice opaque black would be nice on that, although most of those old Harmony's some type of a blonde finish. You could do a sunburst, but with the rather plain wood, I'd probably do that with tinted lacquer and spray it on too. All Gibson's these days (with maybe a few exceptions in the Custom Shop) are sprayed these days. They haven't regularly hand rubbed any color since the 1930's or so.
The best thing you can do if you are going to be finishing a guitar is buy a copy of Dan Erlewine's book
. I've been finishing guitars for 25 years, and was trained by an expert (my dad), but I still learned something from it. Can't say better for a book than that.
One thing to be aware of on the binding - if you look at the binding on pretty much all post-1960 Gibson guitars, they have a very noticeable ledge at the edge of the binding. Its mostly caused by the colored lacquer building up right next to the tape, and then Gibson not bothering to level it properly. The lacquer scraped off the binding is also a contributing factor. I hate that part of Gibson's finishes. Its a hack job, and if you are paying what Gibson charges for a guitar, you shouldn't be getting a hack job! You need to carefully level the build up at the edge. It's a major pain, because it is VERY easy to overdo it and sand through the color. Don't try to do it all at once - make it a bit better with each set of clear coats. You also need to build up a bit more clear on the binding, while you are spraying it.