Personally, I almost never cold set a frame to the new dimension (unless you are going from 120 to 130 mm). A 126 can be squished down to 120 with the quick release skewer, and a 126 can be sprung a little to allow a 130 to fit without alignment difficulties (we're talking about 1/5 of an inch either way). But cold set if you must, Sheldon Brown has instructions for the home mechanic in his pages...

I think...most if not all modern bike brakes take recessed allen nuts...the nutted brakes have a longer brake shaft. Older (like pre-mid-80's) bikes are almost exclusively nutted, unless modified by a previous owner (the higher-end the bike, the earlier in history the recessed allen nuts were adopted). Adapting an older bike is pretty easy, you need to drill the back side of the fork and the inside of the brake bridge to allow the allen nut to recess - if the rear brake bridge is a simple tube this method is not advised for safety reasons...Conversely, if the thing takes recessed allen nuts and you have external nutted brakes, Rivendell or others sells a little sleeve that you can insert into the wider part of the fork/bridge, to allow the use of external nuts.