That's a pretty cool design. As for stitching, if everything is aligned properly, and you keep your chisels perpendicular to the work, you should have no issues punching from the outside.
For non-veg tanned leather, I use straight tokonole to burnish. On thinner pieces, I will either just apply with my finger and lightly rub on it so not to apply much pressure and that seems to work, or after applying it, lay it down on a flat surface and rub with a piece of cloth or burlap-type material. Keep the images coming...again, nice work.