OK heres the deal with graphite: It's messy stuff! The little tube it came in squirts irregular amounts and it gets all over.
Use it in a separate work area than where you dissasembled your camera!

What I ended up doing was squiting some into a plastic film container. I dipped the tip of a Q-tip into the stuff and then tapped it on the edge (like a cigarette) to remove the excess.

With the shutter assembly -completely- dissasembled and removed each blade individually. I used the Q-tip to rub the graphite onto the surface of each side of each blade. It grayed the surface a little, kinda the shade of a pencil mark.
I also hit the shutter housing in this case.

After I was done, I blew away all the graphite dust, twice, before I reassembled the shutter mechanism.

Did it work? I think so. The action is improved, but it was not a huge difference.
I would not reccomend this for most shutters, but in the case of this olympus pen eed I was working on, the mechanism is very weak.