Sean,
You need access to a drill press. As mentioned above Forstner bits are preferred. It's been my experience that these bits bore perfectly from the top BUT clamp the piece securely to another piece of sacrificial wood on the bottom for the bit as it exits the armboard. This will eliminate any chance of splintering. A single Chinese bit will cost about $10 but an entire set can be had for around $25. They are available in English and metric sizes. Buy the right one and you will save yourself the trouble of having to sand the hole by hand for final fit. Oh yeah, drill a small pilot hole first.
You need access to a drill press. As mentioned above Forstner bits are preferred. It's been my experience that these bits bore perfectly from the top BUT clamp the piece securely to another piece of sacrificial wood on the bottom for the bit as it exits the armboard. This will eliminate any chance of splintering. A single Chinese bit will cost about $10 but an entire set can be had for around $25. They are available in English and metric sizes. Buy the right one and you will save yourself the trouble of having to sand the hole by hand for final fit. Oh yeah, drill a small pilot hole first.