I used the wet cloth and iron to steam the holes (partially) closed. I didn't have any problem with glue softening. If you're quick about it and steam for a a second or two, you shouldn't have any problems. Some holes close up fully, others don't seem to change at all. I won't change my technique for the next boat; the holes really don't look so bad. Actually, they're a conversation starter. "Beautiful boat... what're those dots?". You then get to describe the entire process to your admirer.

I didn't try the toothpicks, but remember to heed the warning about inserting them too far and anchoring the boat to the form.