1) Thermite is extreamly hard to ignite, so requires an igniter. Most home made igniters are extreamly unstable (do you really want the thing off accidently (bump it, static charge, RF energy, etc)?

KNO3+sugar works fine.

2) 50:50 mix of AL and iron oxide will probably work, but best to look up a really ballenced % for the best mix. btw: was that by volume or weight?, there is a slight difference :)

By weight.

3) in general, the finer the powder, the better. ball mill it if you can.

The iron oxide you get from ceramics supply places is plenty fine enough. DO NOT ball mill the aluminum, it can explode. If you're not a minor, chem supply places should be willing to sell you 200-mesh Al, which works fine.

7) don't tamp it! - it needs that O2 between the flakes of powder.

Not as far as I know. Personally I'd rather use some sort of cryptographic file system, with the key stored in volatile memory. Connect the power switch to your perimeter sensors and you're safe. Thermite sounds macho but the reality is messy and dangerous. Do you really want to risk a false alarm? --- Jef