Hey Nick, welcome to UnityAnswers.

The SelectWeapon() function uses the GetChild() function to find the 'children' objects of the object that the SelectWeapon script is attached to. I've added comments to the script below to explain.

function SelectWeapon (index : int) 
{
   for (var i=0;i<transform.childCount;i++)  // loop through all the 'children'
   {
      // if the desired weapon value is the same as current child index value
     if (i == index)
     {
         // Activate the selected weapon
         transform.GetChild(i).gameObject.SetActiveRecursively(true);
     }
     else // otherwise
     {
         // Deactivate all other weapons
         transform.GetChild(i).gameObject.SetActiveRecursively(false);
     }
   }
}

As a result, you can't explicitly 'assign the index variable of the first weapon' - rather, you set the weapon to a child of the GameObject that this script is attached to. I'd assume the GetChild() function sorts by name, so you could just name the weapons "0_Fists", "1_Pistol", etc.

Duck's answer to a similar question on 'Weapon Switching' explains how to extend the if/else in the Update() loop, so pressing '3' will select the 3rd weapon, and so on.

Hope this helps!