For the clutch seal, I just used a fresh blade in a utility knife, and went around several passes lightly. The left side is a little harder to get to with the blade in the knife, so I pulled the blade out of the knife for the left side.
If the bike were for me, I'd probably put on some replica tires, but as it's primarily for my wife, I'll most likely use the Pirelli Route 66 tire. I've used them on my V-Star for some time now and been very happy with them so far.
DMV here won't look at it until it's a fully running bike either. Pass the inspection, and they'll stamp a VIN into the neck. I'll then disassemble and send the frame and misc parts off for powder coat, clean up the engine some, do a little polishing, etc. They title it as a custom vehicle, but I'm not sure on what exactly will go on the title.
Kent