My method is similar to Paul's. In addition to boiling in a bleach solution, give it a boil in TSP to remove grease. One method of stabilizing the bone before final assembly is to put it in a jar of Formby's wood hardener and let it soak for a few days, then remove from stabilizer and let it dry for about the same length of time that it soaked. Hint: when it's completely dry, it will feel room temperature when you touch it to your cheek. The epoxy that I use for this type of knife handle is JB Weld, it's thick and nearly indestructable. The color is a dark grey, so it blends in with iron or steel pins if the holes in the bone are slightly oversized. Just use acetone to clean any overflow off. I've made a lot of knives like this, and they turn out great.
That's a nice chunk of bone and it ought to look really good. My main bone supplier is PetsMart, the chew-toy section. They have many different sizes that have already been boiled out and de-greased, saving a lot of work!