Hi all!
You are all right regarding 'dry' pastels.
However, I use oil based ones too.
I use them for dry brushing, here is how it works:
first you rub the pastel to a paper sheet in order to form a thick layer of solid colour
then you take an old paintbrush (I usually take a square tipped one with stiff bristles) and rub on the colour
lastly you dry brush your model
I tend to use mostly white and silver pastels, but also black, gray and brown have an use.
Silver is great to simulate metal shine on nuts or rivets for example
ideally you should use a different paintbrush for each colour, or you'll end up with a dirt brush and a dirt finish...
Give it a try!
Ciao
Edo