I agree with practising with a junker first, you don't want to take apart a brand new toy. A good tip for taking things apart get a piece of paper, draw an outline of the toy and tape to it each part as you take it apart. Easy way to track which pin goes where.
Regular hobby stores are a good place to start with paints and things.
For paint from least toxic to more: water based acrylic>enamels>lacquers (spray cans). Cost Acrylic ~ $5 bottle, Enamel ~ $3, Lacquer sprays ~ $8
For the insignia it would be easiest to use reprolabel stickers. If you are familiar with model waterslide decals then I have some which you can try.