The problem.....
The varnish may just melt, when lacquer is applied. Lacquer solvents (acetone mostly) will soften, craze and melt varnishes.
The solution.....
Get some acetone at Home Depot. Dont get lacquer thinner.. just plain acetone. Wash the body with it. Just have at it.... in a very short time, you'll know if what you have is compatible. Makes no difference - if it IS - then you got a nice clean and degreased body on which to nitro - if it ISN'T - then you have begun a stripping process that you'll need to do.
Since "oil" finish is seldom fully leveled, you might just want to sand first, wash with acetone, then fill remaining grain and pores. Level that with 320. It would be a good idea to hit it with two coats of shellac under nitro, sand back the shellac very lightly... 400 grit just to level it out and give the lacquer a nice smooth surface. Shellac will provide a barrier between the underlying finish and the nitro, but if the existing finish is not nitro safe, its best to acetone it and shellac it. I'd trust shellac over a decal or sharpie signature to be a good barrier. But over an entire body... there's bound to be a place that you missed, or was thin, or had a hole in it... so acetone it first, then shellac.
Shellactoids:
Shellac is a really interesting thing to work with. It sticks to damn near everything with even the littlest bit of tooth. So, it wont stick to polished (clear) glass, or chrome, but will stick to frosted glass and aluminum, and unfinished steel, etc. Ya ever want to paint in a place that was smokey? Give it two coats of shellac over the existing smokey paint, and then paint normally. Assuming the carpet was changed.... you'll have zero odor, as it provides a near perfect barrier to the underlying stench. Paint a metal door... like an aluminum or prefinished steel door? Shellac it first. Give it two coats or three even, then paint away. Just amazing stuff.
So, shellac is both cheap and effective in this instance - but the real thoughts should be regarding the pores, and compatibility with nitro.