Spot putty should only be used as the name implies, on spots! When you have pin-holes, scratches, etc, spot putty is the best to use. Do NOT try to apply this very thick. It will more than likely "pull" and crack if applied too thick.
Also, refer to the "GLAZE
" section for another option over spot putty.
How in-depth you get with the fillers and such is all up to what you're finishing the project with. If you're going for a smooth, glossy paint, you'll need to be pretty thorough in this stage. If you're carpeting or covering in vinyl, then the pin holes really don't matter.