We just used an standard 1 1/16 drill. The bushings are 1 inch in diameter. They do not need to be that accurate because they have 0.030 inches (1/32 inch) of clearance around the hole anyway. You will weld in the slight gap.
I should mention here, there are offset dowel pins that are available from Lakewood. We have found that very few engines are within the adjustability of the pins, so we just drill holes and use the weld bushings. I must say, however, that lately the engines have been better than they ever have been before. So, there is a very good possibility you could just use the pins and not have to weld. I know that would be a better option for many of you guys.
That said, the dowels in the engine block can be almost impossible to remove. When they are particular pigs, we cut them off flush with the block, drill a 1/4 inch hole in them (the dowels are 1/2 inch in diameter) and then weld the hole up. The combination of heat and shrinkage allows you to pull the pin out. (Welding creates heat which expands the metal. When you weld it up, the metal cools off and shrinks--way more than you think it would.) Usually, the dowel will just fall out. If it is still stuck, we weld a bolt on to the cut off dowel and then pull it out. Some can really try your patience (and vocabulary).
David
