Could one drill through a seatstay and weld or braze an eyelet into the hole? I am thinking no integrity would be lost due to the threaded eyelet filling in the hole. I have seen this done on many bikes but am wondering specifically about retrofitting one. Thanks.

I don't think I'd use an eyelet, but I've seen water bottle bosses brazed in for that purpose. Is there some reason not to just braze on a proper rack mount? You'll be repainting the frame either way.

I've seen it done both ways in production bikes, but again, I am asking about retrofitting. Is one inherently stronger than the other?
Below is a picture of a Lemond that had the racks like this from the builder.

Judging from the welds, the frame pictured is aluminum and those bosses are welded in. If your frame is steel, it would be possible to drill and braze in some water bottle bosses. If it is aluminum, its not worth the trouble and you should just get some clamp on mounts. As far as one being stronger than the other, I don't have enough experience to say. On my personal mountain bike, I ran the internal brake and shifter cables through the seat stays and haven't had any trouble yet. Are you going to be doing this yourself? If not, you may be at the mercy of what the framebuilder is comfortable with doing.

The vast majority of the rack bosses that are inside the stays are bottle like bosses. The stay is drilled only on one side and the boss is essentially is a blind hole, not a through hole. I applaud the thought of having a through hole for two reasons. You have two options for where the rack braces connect to the stay (in or outside) and the hole is a through hole (allowing threading repair in the future). I wouldn't be too worried about strength loss in the stay as long as the boss is at least 1/2 the stay's diameter and consider having both ends flanged (a washer would work well).

Being a small guy my stays are angled pretty well froward. I also like chain stays on the long side. So a rack needs long braces to reach the seat stays. I position the bosses on a stand off usually to help the brace reach, still have two mounting options and still have a through hole. BTW I make my own bosses. Here's a shot of my touring frame showing the rack bosses. Andy.

dsaul- Good call noting the Alu frame. To add to this situation- I would never use RiveNuts for a high stress mount like a rack. They are not even good enough for water bottles in many cases. Andy.

Good points and thanks for the replies. Seems like it should not be the dumbest or most dangerous thing I've done. Future People: feel free to reply if you disagree.