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with the old pads, it;s best to open it up with a screwdriver before fitting new pads.
As andy quite rightly said, the piston is merely sticky because it been pushed out for quite some time.
Get a q-tip, dose it in mineral oil, clean the piston, pour in the oil if you have to, put old pads back in, and try and pry it back in (old piston mean less risk of contaminating the pads, and easier to push piston in).
if you bled the system with the piston sticking out, you may need to open the port to let some oil out when prying it back into the calipers with a screwdrivers.
IMPORTANT: once it start working, get some isopropyl alcohol and clean it thoroughly before putting new pads back in.
It's definitely stuck. I read not to use lubricant though as it'll stay in and then go on the pad. What should I use to lubricate it? Without liquid in the system, should the Pistons just go all the way in with no force?