I ain't no x-purt, but here's how I do it. I go the the LHS and buy a sheet of dry transfers the size I want. After removing any old lettering, clean it good. I use a strip of pin striping tape to mark where the bottom of the lettering goes. Hold the transfer sheet over the loco using the pinstripe to line up the bottom of the letter. Then I take a wooden dowel or rounded off pencil and rub lightly back and forth over the letter making sure I've rubbed till I see all the letter has transfered. You will see like a color change when it transfers. Carefully remove the transfer sheet, watching that the transfer doesn't try to lift with it. After all the lettering is transfered, spray a couple of light coats of Dulcote or clear to lock the letters in place. Oh, gotta remove the pinstripeing before you Dulcote.
Anyway, dat's how I do it. Seems to work!