Rolfkt,
First let me say that while you can use higher karat golds (and other harder metals for that matter, including iron) for inlays, nothing works quite as easily or well as 24K gold. And, at least for me, saving a very few dollars using lower karat gold instead of 24 is not at all worth the trouble. As Clockman said in his post about using 14 karat, and then "you beat the %&$*# out of the bands". This brings its own share of risks including marking the surrounding steel with the punch or having the inlay work harden so much that you have to cut it out and start over. With 24 karat, you can almost burnish the inlay in place. To boot, I think the labor involved in a well done inlay is worth far more than the gold used.
I refine all my own scrap gold, silver, and other precious metals and I do refining for many others such as jewelers, dentists, miners, etc. (I started doing my own refining because every well known outfit I sent my scrap to stole no less than half of it. Long story, but I knew exactly how much gold was in each batch I sent out and they all lied through their teeth and robbed me blind. So it was worth the time and trouble to learn how to refine it myself. Another thread...) The bottom line is that I roll a lot of gold plate and draw a lot of gold wire, and nothing works like 24 karat. (The Latin name for gold is Aurum...hence the chemical symbol "Au". The name derives from the same root as "aurora" or "shining dawn". If you ever get a chance to look at gold melted in the furnace where you can look right at the surface of the molten metal, you will understand where the name comes from. It looks like no other metal on earth.)
If you want to use a piece of scrap 14K or 18K gold and you want a quick way to increase the karat level to make it softer and easier to work, you can try this. Melt your clean scrap in a small melting dish with an acetylene torch. While it is very fluid, drop a small lump of potassium nitrate in it. The nitrate will melt quickly and bubble up. As it does, the oxygen coming out of the nitrate at melting temperature will burn out (oxidize) a portion of anything but the gold (silver, copper, nickel, etc., will all be oxidized.) Then flux it with a little borax to gather up the oxide layer. If you do this several times, you will have a much higher gold alloy to work with as most of the alloying metals will be converted to oxides and will go away as a gas or in the borax flux. You can't really use this process to make what is referred to as "four nines" gold (i.e. .9999 pure gold) but you can make it a lot better than 14 or 18 K without all the complicated gear you need for complete refining.
