After reading tutorials again, I went for it. I cut out the #2 option of stripes on barrel with a sharp, but well used xacto blade by hand (not like recommended in vallejo tutorial) and it seemed to work more than adequate. The decal went on easily and looked nice, although there is a small gap were the stripes do not meet up exactly, but it is on bottom and does not bother me.
Well, I messed up because I followed the Vallejo tutorial which is incorrect. I put the "Decal Medium" on then applied the Decal. After reading the tutorial again I noticed mistake in tutorial and applied the "Decal Medium" onto the Decal.
So, THE CORRECT ORDER OF APPLICATION IS: 1) apply "Decal Fix". 2) apply Decal & remove exess water. 3) after decal is dry apply "Decal Medium" amd let dry for couple of hours.
Below are links to various sites explaining the techniques to using these products and other products also
Vallejo tutorial: WARNING!! Tuturial get order of application incorrect in write up, however the photos have the correct order of "Decal Fix" first and the "Decal Medium" http://www.acrylicosvallejo.com/es_ES/applying-decals/blog/1/35
Vallejo product recommendations: Decal Medium 72.212, Decal Fix 73.213, PM052 Vallejo Paint Master Brush, Vallejo Model Air Matt Varnish
Another Vallejo tutorial with correct decal application order: http://www.acrylicosvallejo.com/en_US/big-joseph/blog/1/19
Another nice tutorial: http://www.fantasyflightgames.com/edge_news.asp?eidn=2136
Very nice detail tutorial: http://www.erneslot.es/html-ing/tec_deco.html
Video tutorial using Micro set & Micro Sol: http://www.miniwargaming.com/content/how-apply-water-slide-transfer-decals
FAQ's from Microscale industries: http://www.microscale.com/FAQ.htm
REMOVING DECALS discussion and video tutorial: http://www.scalemodeladdict.com/index.php?topic=7584.msg117637#msg117637