I like a length of chain and a light-duty hammer. You don’t need a thick-gauge chain, but something with some heft and a bit of length to help with a “whip” action. The light-duty hammer keeps you from completely smashing the lumber. I wear leather gloves, especially with the chain.
Take a few practice swings with both the chain and hammer on some scrap wood (of similar species used in your project) to get a feel for how much force it takes to create the look you want. Make sure you have plenty of room to take these swings – you certainly don’t want to damage anything but your intended target. Once you’re happy with the look, then give your project a few whacks.
Try not to keep all the “character” localized to one area, but do create a few concentrated spots of dents and dings. You want a well-worn look, but not an intentional destruction zone.
You can highlight the dents much like the method I described for worm holes, by adding a slightly darker color. However, use a light touch – too dark a color will make it look artificial.