Hi Robin,
A) The washed-out and worn areas of the fabric should be lightened with the appropriate colour of the base fabric: cotton, off-white or white; linen, dirty buff, greenish or brownish beige; wool... well a wool colour! I think one of the best looks to aim for myself is to have a gradual fade from top to bottom of the garment, as though the dye is washing down into the lower areas - you see this in the lower legs of jeans sometimes for example, but this is hard to balance with the normal shading so it's not always possible to do well. As you can also see from jeans, fading occurs fastest in areas of wear so imagine where these will be and lighten accordingly.
B) I like to apply dust and dirt over a fully-painted clean paintjob instead of laying these in at the basecoat stage and then highlighting and shading accordingly. With dust I really feel this looks better most of the time, for dirt I think it's easier to get a consistent finish doing it at the end.
I usually paint my weathering effects on with a very gradual buildup of acrylics but I've used pastel dust too sometimes and the results can be very realistic; they're particularly good at simulating dust I think. It's self-explanatory how to apply pastel dust dry but if I'm using them wet I mix up the dust to a slurry (with water usually, but white spirit/turps works even better) and then paint them on. When it's dry you can blow or gently brush off the excess and if you work the surface with a stiff brush you can rub it into the paint for a most realistic result; this is great for ground-in filth on cuffs or elbows. One of the other great things about using pastels is if you're unhappy with how it's looking you can often wash it all off and start again from scratch.
Einion
