yes you need lithium paste assuming you don't want it to leak, you might get away with soaking the seal in CLEAN brake fluid for 45 minutes but that's for new seals not used ones.
Did we not think that getting the eBay caliper was a good idea and you were going to practise on it?
Have you figured out how to get the dust seal back in its recess with the piston in place?
Do you want my address for me to put the good one back together for free whilst you have a play about with the eBay caliper?
the seal kits are PER caliper and there are two kinds, there are equalising seals in the piston as well that's why there's an air hole in the recess where the dust seal sits in the piston......don't take that to pieces just yet
the only really reliable way to inhibit the piston is to have a 41mm bung machined at a machine shop in fact you'll need 2 of course, it will be two process as they also need to drill into the bung to make room for the handbrake post, you then need to drill and tap the top and put some threaded bar into it and then a bar to push against where the pads sit x 2 of course
That's what I did about 60 pairs ago, also got every piston cap for 4 pots from 28mm through to 46mm got 8 each of those
my very polite point being if you want to do a proper job then you need the tools required and for one pair it probably doesn't stack up (which is why nobody does it)
also have a M10x1 tap and an even rarer M12x1 tap and wrench handy as the threads will invariably be mashed as they frequently suffer from dissimilar metal corrosion, I tend to use a degrippant on them overnight before undoing the bleed nipples
Lot to it pal, get that eBay caliper bought and have a frig about with it
