DO NOT do it with sandpaper unless you really know what you are doing. You may damage the stain, and will certainly have to rewax. I would explore other alternatives to remove it before going that route. You could post asking for help in one of the forums here, there are a ton of restoration experts that have helped me with a bunch of stuff in the past, I'm sure one of them would have a more elegant solution for you, or at least be able to give you good advice if you do go the sandpaper route.
I've just learned doing a couple dozen restorations, that when your brain starts thinking sandpaper might be a good idea, THINK TWICE, do more research, and make SURE that is your only option. Because it may lead to quite a bit more work to get the results you are looking for.
I use very fine stuff fairly often if I'm planning on rewaxing or restaining the entire stummel, but other than that I avoid it at all costs, ESPECIALLY on rims, as if you take even the slightest wrong angle and sand some of that sharp outer (or inner) rim corner it is a real bitch to get it to look normal again, if you even can.
IMO the charring on your rim is nowhere near bad enough to even worry about, but if you want it gone I'd ask for help in the forums for non sanding options, there's gotta be something.
If you do go the sandpaper route I'd buy a couple cheap estates on ebay to practice it on before attempting it on something like your Castello. There are Grabow etc. lots galore on ebay all the time that are great for practicing on, and you can scoop up a handful for like $25. It's well worth it for the experience and practice with restoration of any kind.
Plus you'll have a couple nice looking cheapo burners for the glove box when you're done!