Hi Martin....I am still a little confused re the polishing compound use with paper. I have what you sent me plus some white and red.
Do I keep adding compound as I go?
The white you have is most likely a reasonably fine aluminum oxide and will work fine, might even be a touch more fine than the material with the kit. Will work but won't be able to do the same amount of repair and maintenance as the grey silicon carbide. The red is likely iron oxide and is only good for softer metals like brass, silver, gold.
You can keep adding some compound as you go as long as the paper is in good shape. I prefer to rub it down good with some paper towel and pick up most of it before re-applying after I've made 20-30 passes. The compound (any compound) will accumulate removed steel and turn a darker color - as it loads up it looses effectiveness, so I tend to refresh it fairly often. Depends on how its used. If I'm coming off of the 600 grit paper and stropping for refinement, the paper is likely to be a bit loaded after 20 passes or so. If the knife is already polished up and I'm maintaining it, a handful of passes every so often and the paper can last a long time with the same application.
One of the benefits of the Washboard using paper for the strop surface is you can swap it out when it loads up, no need to clean it if you don't want to. When in doubt, rub it down and re apply or recycle the paper and use a fresh sheet - any copy or writing paper will do.
This is the video where I introduced the silicon carbide compound and detail the best practices:
http://www.youtube.com/watch?v=Ls0WJp08iVY&feature=youtu.be
Also can I use paper and compound to get rid of small scratches on the blade?
You can, but use three or four sheets of paper as a base or you might see the imprint from the tooth pattern in the board. The grey stuff I supply will leave a hazy finish, not quite satin but close. Rubbing the initial hit down with a paper towel will leave mostly the finer abrasives and make the finish a bit brighter yet. Your white compound will do a good job for cosmetic polishing as well.