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To gravity bleed, you make sure the master cylinder is full of clean brake fluid, crack the bleeder screw open, and wait until clean fluid comes out of the bleeder.
In my experience, gravity bleeding is great for:
(a) filling a new system or one you've replaced lines in,
(b) bleeding a system that just doesn't want to cooperate with the other methods. Since C3 brakes are notoriously uncooperative, gravity bleeding is a common procedure.
After gravity bleeding, I always do a manual bleed (pump once, crack bleeder, close, repeat as necessary) just to make sure. I've been told it's not necessary, but I don't care - I do it anyway. I want to feel that pedal solidify while I'm sitting still.
When you gravity bleed, car is supposed to be even (just like it sits on the tires. I put mine up on stands (even), and gravity bleed and then pump bleed the brakes. Works every time.
As I understand it you actually create a leak in the system, then plug it up. I don't want to rain on your parade, but leaks cause air to get into the system...that's why fluid exits the bleeder in drips...cause air is getting in back of it and separating the droplets.
Get a clear hose and a clear bottle, you can buy it already selected for you called a "one man bleeder kit". I also suggest you contact your state's Department of Motor Vehicles and purchase their "Brake Inspection and Repair Handbook" to learn about brakes like I did.