Dear Sharalee
Be sure to read my short article on plank floors in the Hardwood Authority section. You may want to add some screws and pegs, as I suggest in this section. It will prevent warping and separation of the boards. As an alternative to this you can use steel cut nails at http://www.tremontnail.com
If they are an Eastern white pine (like I have in one room) be sure to finish it with at last 4 coats of an oil modified polyurethane. The old holes will be fine, just allow enough time for each coat to dry. You can only tell if a coating is dry, when you scuff sand it, and the sandpaper or screen doesn't clog up. If it clogs wait another 2 days, and be patient.
I believe the pine should be just clear finished, as this wood doesn't have a good appearance when stained. But if stain you must, use a gel stain for sure, it will prevent blotching.
Apply at least two coats of finish on the floor before you stencil it. You will have to make sure all the stain, finish and paint are compatible with each other.
So here's the order of things that will work best:
Sand the floor to 100 grit sandpaper, remove edger marks, and screen entire floor.
If you must stain try using the Old Masters gel stain from http://www.leevalley.com prod. #56Z28.55.
Then BRUSH on two coats of OMP (Fabulon Brand Pro Poly 800-263-8108). Don't use a lamb's wool applicator.
Then use Flecto colors in plastic for the stenciling at http://www.flecto.com/products/var_w_cip.html.
Finish the job with 2 more coats of the OMP. Be sure you scuff between the coats of finish and paint, don't scuff the stain.
You should certainly hire a professional floor sander to sand the floor. Be sure to read my article in the Hardwood Authority section, on this very subject. But with time and patience you should be able to do all the finishing yourself. I wouldn't trust nice stenciling to most of the floormen I see out there. You will find that there is a lot of hand sanding and brush work involved for a good job. Most pros want to put their buffing machines on the floor, and this can whisk away parts of the stains and stencils, I know I've seen the results.
As always your Most humble servant, Joseph, the Wood Floor Doctor.
You may also find these articles helpful:
1. Floor Types And Finishes
2. How To Apply Oil Based Polyurethane WITHOUT The Pits And Bubbles
3. Custom Staining Wood Floors Without The Blotchy Effect
4. Laquer Finish Floor Fires
5. How To Take Care Of Your Health And Safety when Installing, Finishing, Repairing or Cleaning your wood floors