I have little experience in pulling apart the engines like you have. 1. What do you use to de-coke the piston crown and head and is it realy vital to do it at all?
Scrapers [see above], and a small fine wire brush wheel in an electric drill are the handiest tools for this job. Yes it is a necessary task, as if the carbon builds up too much, it can crack off in chunks and cause damage. Pre-ignition can occur from hot carbon, as well - it usually happens when the carbon is thick, and the surface rough.
2. what is a proper method to remove the old gasket without digging into the metal in the process. I recently tried doing it with a used razor blade on an old powertorque and found it a frustrating experience. I ended up resorting to rubbing the head on sand paper mounted on a sheet of glass to remove all traces!
Scraper/s,as mentioned above. BTW, lapping the sealing surface of the head using fairly fine [400-600 grit] wetted wet & dry paper, backed by sheet glass, is an excellent way of ensuring that the surface is flat.
3. Do you need a torque wrench to tighten the head nuts or is there a rule of thumb method to tightening coreectly, including the sequence?
Well, it's best practice to use a torque wrench, but it wasn't specified by Victa until the 160cc engine came out [9-11 ft-lb, BTW]. The workshop manuals for the 125's just say 'tighten evenly and firmly'; see this Victa workshop manual excerpt:
https://www.outdoorking-forum.com.au/pages/V...icta%20Workshop%20%20Engine%20Manual.pdf If you don't have a suitable torque wrench [those sold for car work are difficult to set accurately at these low torque values], use a fairly short spanner [say a ring/open end combo], or a 1/4" drive socket wrench. This will help to avoid over-tightening the nuts.
The tightening sequence is straightforward; do them on the diagonals, i.e. like this: