And some definition to what the term "lapping" refers too?
From the context clues of the sentence it was used in... it sounds like some method/procedure for making sure the head-to-cylinder surface junctures are as planar/flat as possible so that the gasket seals proper... am I understanding it right?
The goal is to provide the best suface for a good reliable seal. That usually means a flat surface. There is a difference between "sufacing" the gasket area and "lapping". Surfacing can be accomplished by cutting or using an abrasive attached to a stationary flat surface and moving the head or cylinder around on that surface to remove any high spots in the aluminum gasket surface. You can do this to the head, top of the cylinder, base gasket area (although it's a bit harder), carb bowl, flywheel cover, side cover, KIPS cover, case halves, etc. You get the idea. I have a surface plate that gets a lot of use. Some people use glass, although the tolerances for flatness of glass depend on a lot of factors.
Lapping is actually rubbing two mating parts together with a small amount of abrasive paste (grease with abrasive particles) to make the two surfaces match. They may not be flat. This is useful for things like conditioning the flywheel to crankshaft tapers so that they fit precisely.
As far as your cylinder and head goes, once you measure the bore, you can measure to make sure the head/gasket surface is perpendicular to the bore, the top and bottom decks are parallel, then surface the top of the cylinder and bottom of the head. If you want to go the extra step and lap the two together, well, that's up to you.
Once the cylinder studs have been installed and head nuts torqued, as stated above, the material does get deformed a bit around the threads.
Regarding torque, don't forget, specs are given based on dry (friction) threads. I use Anti-sieze in a lot of locations, so I have to be careful not to overtorque if I am using the specs.