Cut slowly. Watch out for kickback. Be aware that blades/bits will dull faster than they would on a softer wood.
I'm not sure what family "desert ironwood" belongs to, but Ipe (the most common "ironwood" sold in this area), like many tropical hardwoods, can cause allergies in some people due to the same chemicals that make them naturally resistant to insects and rot. Use dust collection, use a mask, shower afterwards to get the sawdust off your skin. I believe the issue is mostly sawdust, since that's the extended contact over wide surface area; as far as I know your knife scales should be OK.
(I haven't run Ipe thru my table saw yet, but the guys using it as decking seem to do OK with carbide blades, and it bandsaws reasonably so far. Ipe is being used for decking due to its rot resistance; it has the advantages of real wood while lasting as long as the plastic/composite solutions. If you want more detail you should probably ask over in Home Improvement ... But this means you can sometimes get small offcuts of Ipe free by asking a decking team for their scraps before those get dumpstered. I have a few cubic feet obtained by cleaning up after a ramp was built in a local park.)
Re retaining the natural color: Wood tends to bleach under UV light. Look for a spar varnish or similar transparent topcoat that contains good ultraviolet blockers. Though realistically, a pocket knife spends most of its life shaded.... and the decking seems to regain a lot of its color when wet, so this may be mostly a surface effect.