I agree completely with Ken. When I build a modern dulcimer, I tend to use spray semi-gloss clear lacquer such as Deft. It's fast-drying, smooth-coating, and looks fine to me once it's knocked down with steel wool, waxed and buffed.
For historical reproductions, which I'm known for now, I try to replicate the finish that was used by the original builder. This would include (amber) shellac, flat black milk paint, oil or whatever else I can determine that they used back then.
Great question!
