Furniture, Wood and Cabinetry Finishing - Repair and refinishing timber frame beams

Hi all:
I'm in the process of renovating my post and beam home. Overall, the posts and beams, either (chestnut or white oak) are in very good condition for 250 years old plus. However, there are small areas of insect damage that I would like to repair for cosmetic purposes only as they are structurally sound. Once, repaired, I would like to refinish them.

So my questions are as follows:

1) what is the best way to repair the insect damage, do I chisel out an inch or so of the beams and lay in a patch (i have plenty of old beams) or is there a filler that is stainable

2) what is the best way to prep the beams for staining ?

3) am looking for suggestions on what to use to refinish the beams. Someone recommended used motor oil, but I question the logic of that. Thanks

Personally I think cutting out a section an inlaying new [old] wood would look best. It is possible that the repair might need to be stained separate from the old wood so the color would be the same.

Motor oil would be a good choice if it were a barn but don't think it would be a good idea for inside living area. There are main choices for clear/semi-transparent finishes. You should go to a paint store [not dept] and ask - they should have many options to show you.

Looks like I'll be sharpening the chisel. Any tips or tricks on the best wat to do this would be appreciated. Thanks

Take an utility knife and first score out the area to be removed - helps you to get a straight line and IMO works better than a pencil mark. Then chisel away. Remember only the face shows so as long as all the edges are neat and match the replacement peice it doesn't matter how precise the bottom is - adhesive should make up the difference.