For all changes to my figures I made until now I used the standard Milliput putty. I also have some Magic Sculpt on the shelf, that I will try later.
It is very important to work with very thinly rolled sheets of putty. To roll out putty, I use baby powder. Pour some powder on a smooth even surface, and you can start, using some round piece of metal.
To apply and smooth the parts made from putty I use rubbing alcohol. If you want to touch up some areas on already painted figures, you can also use tap water thus avoiding to remove the paint again by accident. If some putty is left, you can keep it in the freezer, where it should stay workable for at least 24 hours.
I have just started to use putty for remodelling figures, but I think the key is to work in single layers, and to always wait for the putty to cure in between. So you have a lot of control over the process and are safe from accidentaly damaging already sculpted areas again.