Got any tips on DIY 2.6 head gasket replacement?

I have a 1987 260E with the 2.6. It leaks oil like a sieve! It comes from the head gasket area at the back of the head and drips onto the exhaust.

I have read the Alldata tech CD and feel that I can do this. Several questions for the pros, ameteurs and anybody who has done this before:

Is there anything that I should do "while I am in there?"
Is there anything that I should remember to do / not to do?
Are there any special tools that I will need?
How can I tell if the valves or the head need re-working?
Are there any shortcuts - like "Leave the _____ in place, no matter what the CD suggests."
What other gaskets will I need? (I'll ask the parts guys, too.)
Are there any bolts to use lock-tite or specialized thread lub on upon reassembly?

The CD would have me believe that it's a pretty standard procedure.

Thanks SO MUCH, in advance.