OK, here is my 2 cents. I did a complete restoration myself and was faced with the same problems with these small screws. Please, follow the instructions given by JA17. He is correct in method. I was able to extract ALL of my screws, from the entire car, not with ease, but successfully. Use a good penetrating oil. new # phillips bits, prefferably with serations on the blades and use care and patience. striking the bit with a hammer will help break the hold of the rust. If you clean the heads well enough and use enough care, most of thos screws could be reused. With those small screws, I don;t know about an air hammer, but I like the idea of the valve lapping compound! Great tip.
Welding- Absloutley last resort, lots of patience and work slowly and methodically. I even got all if the small screws out of the bows of my top frame.
Allen