I can only imagine how exhausting it is with a toddler and a new born. I have my hands full with just one 5yo!
Yes of course it's a great help in the process if you have not been feeding to sleep in the day, that's a big step you don't have to break
And yes you certainly can start with one nap per day in the crib, that's what many of the members do when they have their hands full will another LO around.
And one question... If I start by putting down asleep and she wakes up within 5 minutes each time I put her down, i just pat shush back to sleep if possible and once she's awake try again for next nap (provided I can with my other little one around)? At some point do I just hold her for a nap so she can get some good sleep?
The starting point with shush/pat is to totally calm baby in arms and to let her fall to sleep in arms whilst shush/patting, then to transfer to the crib and to continue to shush/pat for an additional 20 mins until you feel/see her relax into a deep sleep. Tracy describes in her books how many people get LO asleep in arms, try to put them down and baby wakes 5 or 10 mins later, this is because they are still in light sleep and need shush/patting to deep sleep. The idea of shush/patting for the additional 20 mins is to avoid this happening.
You can also begin shush/patting at 30 mins into the nap to help baby transition from one sleep cycle into the next, and this too would be a 20 min shush/pat. It's called W2S (wake 2 sleep, there is a FAQ if you wanted to read it) and can be very helpful in getting a longer sleep to avoid OT because baby is more inclined to stay asleep when you are there shush/patting rather than fully wake. It's generally hard to get them back to sleep when they fully wake.
However that means WD of up to 20 mins, then 20 mins shush/pat in crib, a 10 min break before LO begins to come into lighter sleep and can be shush/patted for another 20 mins for W2S. When you look at it like this there is an hour of shush/pat for a 10 min break, that isn't much time for You or for your other child, however it would likely get things heading in the right direction more quickly.
You might be able to put her down for naps in a crib in the family room so you can be with your older child. I think many find the baby is too interested in the older child to fall to sleep in the same room but it really depends on everyone's characters. For instance at 4.5 I know I could have asked mine (and made a habit of it) to read quietly for 20-30 mins, or I could have asked him to watch TV on quietly for 30 mins. I also know at the very young stage mine fell to sleep well in the family room (travel cot) even with other people around and some quiet chatter or TV on. Although at 10 wks mine suddenly decided he would no longer nap in the family room and I had to take him to his night bed for naps, I never expected such a young baby to have an opinion (shows what I know!).
One other thing I'll mention is that when you have 2 LOs it might be preferable to sleep train into a stroller, although it's considered AP many people find it invaluable to be able to have baby nap in the stroller so they can get out and about with the older child to go to the park or school drop off and pick up. My own LO, as I said was sleeping independently by about 8 wks, would only nap in his night bed by 10 wks so I had a difficult time trying to get out the house and hurrying home for the next nap. I even had a thread asking if it was possible to re-sleep train him into the stroller. As it turned out I did not re-sleep train but he started napping in the car seat so I timed all outings for him to CN in the car on the way. It's just something to keep in mind when you begin ST for the second baby.
hope this helps...and soon you will be the 'expert' on how to sleep train an 8 wk old when there is an older child to care for