I don't know the specifics of the old ways, but Brownells Nitre Bluing salts give a similar finish.
http://www.brownells.com/.aspx/pid=1105/Product/NITREBLUE-reg-BLUING-SALTS

I believe the spur and bit guys use it or similar to get this color when it was popular with them back about 10 yrs ago. Kinda like spinner wheels, the fire (nitre) blue spurs and bits have all but disappeared. Thankfully.