Brian- You are correct. Here's a couple of shots of the last time I did this (as seen in my Lug Making thread a while ago). Note the simple set up. The tube in the vise has two plugs in it to prevent crushing from the vise. The angle if set freehand, the hole saw is lowers (while not turning!) to confirm it's coaxial with the tube. There's no pilot drill bit as I don't want to punch through the tube's other side Andy

I forgot to add that as Mark said the hole saw is the same diameter as the frame tube is. The lug blank tube is .125" larger in diameter with a .058" wall resulting in about .003" of clearance for the frame tube. Of course real life changes this clearance somewhat...

Mark- I have head various stories over the years at both the Asian's ability to do amazing work as well as seem to have no knowledge about what they are making sometimes. One story I remember had to do with one Asian company being asked to produce a rear der similar to the classic Simplex Prestige (that black plastic der so common on thousands of base level Raleighs and Peugeots). It too them only a few weeks to do this.