I used to do faux inlay, I am not good enough to real inlay.
There is a product, comes in a container like a pint size milk carton, that is water putty for wood work. It dries white, says you can stain it but I have not had luck with that aspect. Sands like wood and is hard as a rock.
Just mix the powder with water to a consistency like oatmeal, and pour it in, sand it flush.