Chuck There is no right way or wrong way. There is your way. I did some inlays on a S&G similar to what you describe. I only went down throught the first layer of ply and wound up sanding through a walnut inlay which made for some light spots. The solution was to buy some burnt umber oil paint and hide the errors. Once glassed and from a couple of feet away you can't tell the difference. Inlays are an eye catcher and those who build boats are impressed with the effort. Jeff