Nice shape, well done!
I agree with the comments re the sanding, you can get those out, simply going through the grits slowly from 180-320. You must also only sand in the direction of the grain, ie up and down the body, not across. A sanding block will help the flat areas and throw the paper away if it clogs and has large lumps in it.
Re the tuners, Pitbull sells the Grovers for under $50 set inc freight - they are a huge upgrade and a massive bargain. I have several guitars with the kit tuners on them and they are OK, I have had one or two dodgy ones only over almost a dozen builds. The problem you show in the pics isn't a faulty tuner, you may just need to ease the holes out a little to allow them to slide all the way in. The Grovers will go into the holes you cut for the stock tuners including the small hole for the screw so you can upgrade later.