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@grog and I diy'd this in our house in Jan - insulation, sanding and treating. Definitely worth doing. (Side note - we ended up going for a Bona primer / Bona Traffic HD over Osmo).
As you say sanding will make a HUGE mess so it's worth hermetically sealing rooms off, so it doesn't get into the rest of the house, and it is very noisy so worth giving neighbours a heads up... Also, get way more sand paper than you think you need! I had to go back and get more even though we thought we'd got plenty.
I DIY'd this too, though did it whilst renovating before we moved in to the house after buying it.
Did all of downstairs, about 50sqm, and it took about a day (boards already lifted; not including nailing them back down). Wasn't quite as neat looking as Ed's photos, I must admit, but we've never felt any draughts nor notable coldness in the floor, which is/was always naturally quite gappy (might buy and install draughtex at some point, but more for aesthetics).
Materials-wise it was probs only a couple of hundred quid - screwfix roofing membrane; cheapo rockwool alternative; screwfix DPM; staples.