To get the best results require sanding and more sanding and then even more sanding. You are correct uncivil_engineer everything will show in these newere glossy decals. If you want it perfect and that fact you are doing it at i i assume you do. Bog any holes sand it nice and flat prime it and sand it nice and flat. I am really anal so i cleared it and then i sanded that nice and flat on my IJ resto and it came out fantastic. If you want a look. Bit of fun. If not here's a pic before final sanding.
http://www.aussiearcade.com/showthread.php/73047-IJ-Restoration