Yes, pipe threading oil!
I've never owned a bottle of the stuff so I use whatever is handy, usually the nearest quart of motor oil.
The only thing I'd say about black iron is be sure and put drip stubs (they should be there regardless of what kind of pipe) below your outlets and filter it right at the wall when you paint.
About copper and pressure. Copper is used extensively for residential water systems where working pressures can range up to 150 psi. That is with generic soldering techniques. There are a couple of different grades of copper and the better stuff is used in air conditioning where it may see 400 psi. The only real difference is the A/C stuff is usually braised or silver soldered. I'm going to be doing my garage soon and I plan on using copper. The only thing unusual is I'm going to use long radius elbows designed for A/C work.
One thing I've seen done is some shops is to run a large (6" or bigger) pipe down the center of the shop and branch off of it for other lines. If it's very long, it eliminates the need for a separate storage tank.