The problem is that each bead has this clay-like crap in the hole in
> the center. I vaguely remember this stuff being mentioned in some
> lampworking threads.
Bead release. (so it doesn't weld itself to the mandrel.)
I want to know if I should clean this stuff out, and if so, what is
> the best way to go about it.
Yes, and carefully. Try soaking it out, and using pipe cleaners or similar.
Also tell me what NOT to do!!!
Don't use a dremel... indian lampwork isn't annealed and will probably break if you try cleaning the holes with a dremel (speaking from experience here...)
I'm sure others can give more/better advice...