Any other ideas how this could be made better? Like I say, it's passable, but not great.
Yep, if it has illuminated numbers, gently pry one of those out, I use an X-acto knife. Then just push the other one out from the open side. Finally, push the headlight lens out from the back with a curved tool. If the numbers are not illuminated, you'll have to just work the headlight lens out with something like an X-acto knife point. As a last resort, I drill a tiny hole in the back and use a small rod to push the headlight lens out.
Next, I use a 3528 SMT LED and solder fine wires to it. I coat the back with a layer or two of Liquid Tape. I slide that assembly up into alignment with the headlight lens and glue it in place. My technique is to put a spot of CA adhesive on the back, slide it up into place, and then using a small piece of wood dowel, press on it and clamp it with a spring clamp to dry. Put all the lenses back in place and you have a working headlight.
Yes, it's a bit of a PITA, that's why I now charge a few bucks extra for pilot mounted headlights in my LED upgrades.