A New Old Guitar

I came across a guitar last Friday, so now I have a new project. It's in pretty rough shape, but I've always wanted to know how to build guitars, so this will be my introduction. Here's a picture of approximately the condition in which I got it:

That's not even the coolest part. If you didn't notice the bridge in the first picture, take a look at this:

That's right, it's a twelve string. I played a few notes on the four strings that were still intact when I got it, and it sounds terrible, but that's not the point. The point is that when my work is done, it will sound like a twelve string.

Even though there's a lot of work to do, there's a few things that seem good. The neck looks fine, no big gouges taken out of it or anything, no twists. Check it out:

The frets need a little work. At least one fret needs to be glued down, and the zero fret needs to be replaced entirely. I can't wait for that part. Fret work sounds like fun. At first I thought that the bridge needed some work, but upon closer inspection, it looks like I can get the guitar into a playable state with the bridge that's already on it. It just needs a few new bridge pins.

On Saturday I started by lifting the pick guard off. It was a lot easier than I thought it would be. One edge was already lifting up, so I started pulling from there, and it came off easily. That was all I could do Saturday because the stores were closed by the time I got around to working on the guitar.
On Sunday I started sanding. I wish I had taken pictures earlier so you could have seen how bad the back looked. The finish was cloudy and cracked in a few places. I could have sanded it down just a little bit since I'm thinking of doing solid colours, but since the finish was cracked, I decided to take it down to the bare wood. Here's a couple of pics of the sanded back. The white powder that was all over the guitar in the other pictures was sawdust. I just placed the pick guard back on the body for illustrative purposes.
When I first got it, you could tell the back was originally the same colour as the sides. I don't know how it got so ugly. The next step for me will be to sand the front down to the wood (there's cracks in the front finish too), then seal the wood. After that, it's probably best that I try and make it playable before I do too much other work. If I do that though, then I could end up wasting a set of strings when I have to take them back off to paint. I guess I'm most worried that it wont be able to support the tension of all the strings. It wouldn't feel very nice to have a newly finished body destroyed just by stringing it up.