Your gun is a known as a Police Positive Target. The target models were Colt's premium line of guns at the time. Although only marked "22" your gun will shoot 22lr ammo. I have some of these little guns they are are great shooters and an absolute blast for plinking.
To answer some of your questions, it has certainly been reblued. From your photos, one can see old pitting which was not poished out under the finish. I would agree with the 1910 date, the stylized "C" logo around the Rampant Colt stamp on the sideplate was only used until 1913 or so. My best explanation of the 1926 barrel date would be that it was rebarelled at some time , perhaps when it was reblued.
As to the grips, your gun has what is known as the small (narrow) grip frame. Colt used two different frame sizes on the Police Positive. Original grips in good condition are selling for well north of $100 on ebay. There is a company which makes reproductions (Vintage Gun Grips) but they sell for close to $50 with shipping and the quality is not very good.
I have never had a problem with dry firing my 22s.
I think the price you paid was fair considering the condition of the gun. As I said, the PPT 22s are an absolute blast. I seldom go to the range without bringing one. Hope you get to enjoy it!