Hi, Thomas.
The oil goes on the base side, not the emulsion side. And you really have no need to clean it, since you will need it there any time your print the neg anyhow, and the oil is not everywhere in the end, but only in the cracks themselves. I rub it on with my finger as if polishing a car ("wax on"). The oil fills any scratches on the base side, but the whole surface is also then covered with streaky oil, like after you put the wax on a car. Then I gently smooth the streaks out with a cotton ball ("wax off"), hopefully leaving only the oil that has been pushed down into the scratches.
I thought when first trying it that it would simply soften the line on the print, making spotting easier. But it actually appears to "fill" the scratch on the print.
It saved my butt really, really big once. I was printing a portfolio on a deadline, and I had finally got to the final print, a print which was very important to close the series; no other neg would have worked as well. I had two pretty-much identical negs, but one was exposed better and slightly straighter. The slightly crooked and underexposed one also had a nasty scratch on the base side. So, of course, I was printing the better one, and unfortunately (and I have forgotten exactly how I did it), a little splash of stop bath landed on the emulsion when I was dusting the neg. I didn't notice when it happened, but I started seeing this weird thing appear on the print, and started obsessing over cleaning the neg again. I busted out the film cleaner, which I rarely do. Then I realized that what I thought was some schmutz was actually an area where the emulsion had been partially eaten away, leaving a depression. Being horrified and desperate, I started printing the other neg, but it had a big, long, sharp white scratch through the sky, about 4 inches long on an 8x12 print. Nose oil on the base side to fill the crack made it look as if I had scanned the neg and fixed the scratch with a clone stamp in Photoshop. It didn't even require any touch up with spot tone.
It's really worth trying on a junk neg or two if you have the time. But AFAIK, it is only useful for scratches on the base side. For scratches on the other side, a mechanical pencil to fill the scratch on the emulsion followed by some good spotting is the best way I have found. It is a PITA and rarely looks perfect when I do *just better than not doing it.