Hi Mate
What a busy thread! Lost wax can be a good way producing small brass parts but I've had a rethink (based on the assumption of no machine tools at home!).
You could have them cnc'd. Or, fabricate, I've looked around for channel that size, not there. Get some one to mill out the channel from bar the right size, easy job = cheap. Those little posts? drill through, countersink and rivet, just a hammer and drill required and a little patience. Or, drill a blind hole and solder them in (make them from 3mm bar). You could silver solder but if they are a tight fit, regular soft solder would hold.
Brass works well and easily with simple hand tools, rivets can be filed and polished flat so you cant even see them.
Then I thought, through to the back plate? I make the odd knife, check out these knifemaking supplies, they have lots of rivets for fixing the scale, and also a lot of leather working tools a well .. nice!

http://www.attacc.com/itemslist.aspx?listid=11

http://www.english-handmade-knives.c...of_scales.html

They are all designed to be fixed/tightened and filed flat. Brass polishes rather well but tarnishes and marks easily (see knife!). Generally you would plate or at least lacquar. A brush matt finish would last longer.

This is a recent knife I made, just utility and scratched. the brass ends are riveted on with two rivets (on the left one, one of teh rivets is a tube). Yes you can see one but I wanted it quick for a fishing trip and inherently lazy. The rest are invisible.

http://www.flickr.com/photos/4933236...in/photostream

Re stiching you are sort of right, but there is stitching and stitching. Some needles have cutting edges some are round, for a light leather a round needle would be better and the stitch density and thread tightness makes a huge difference to the strength. You could back the leather with something (could be more leather) and scive the edges, you would never know it was there. If I were to be critical of the design I would say that with the pegs attached only to the channel, it will want to twist and the holes in the strap will stretch spoliing the neatness of the strap just above the brass. Just some stiching will help some of the stress to be relieved and give a better look for longer. With a hook shaped needle you could run the stitch up above the brass for a small distance and it would be invisable, just stiched through the fold. (Im in the footwear industry). But I;m also assuming you don't want to scour the planet for machines that will do this!
Option 3 (I think) .... slot the bag face, strap through slot, through backing plate, back on its self and firmly fixed. Brass channel hides joint, where you have stitched a dummy strap end?

Just thinking aloud.

Tom