He was a plumber from England who had never been to Tibet in his life. (We have this information courtesy of a bunch of Tibetan monks who hired detectives to check this new guru out.) Now, to be fair, he did say later on that he was 'channeling' the long-dead Tibetan monk, and millions of people have bought his books even after this spurious bit of after-the-facts retelling by Cyril.
As for the 'third eye' operation, it is probable he was talking about trepanation, an operation that you need like another hole in the head. (Heh heh heh.) That's where they drill a small hole in your skull to 'release the energy'. Yes, some think this is a good idea. People have been doing it for millenia, but Mr Hoskins... I mean, Lobsang, was not one to go under the drill. I've linked to an article here, but it's pretty icky stuff- definitely not for the sqeamish.