What's the best way to edit the look and feel of the dashboard
There's not really an official way to theme widgets, or at least not an Apple-endorsed method for theming.

Editing the widgets is fine though, although be prepared that the system widgets in /Library/Widgets may get replaced on OS X updates, so keep backups and be prepared that things may change (they may rename the resource files, etc). Alternatively, copy the widgets out of that folder into your ~/Library/Widgets so that they are preserved on OS X updates.