I'd make a paper template (like Rotor does for his blocks) to mark out/make the punchholes for starting the drill off. You should'nt have any trouble with a 3.5mm drill, I've used one for loads of 5mm deep holes (well 4mm!)...
How about using silicon sealant for the tubes?. I know you want something alot less viscous realy but at least you know it's 100% waterproof

. You could make the initial holes 0.5mm bigger to make room for the adhesive. I like BB's idea of a jig using tack/pins tapped/pressed into a soft piece of wood (block of balsa?) to hold the outlet ends precisely in place...
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O/T'ish: I'm getting a wierd result in testing two different rads with your block you sent me. Ones a heatercore with 18cm x 19cm finned area the other is a 2 x 120mm fan PC rad. When I tested them both with the maze3 they both performed identicaly. Now using your block the heatercore is beating the 2 x 120mm rad by 2~2.5DegC!, plus I'm only using 1 x 120mm fan on the HC and two on the PC rad...
Why would block A produce a 2DegC difference in two rads when Block B produces
very close/the~same temps??...
I'm damn sure the room temp has'nt dropped in the 1hr 20mins it's taken me to change the rads and get the temps up with Prime95. I only have an aquarium flat plastic thermo' to read room temps but it has'nt changed. The only thing I can think of is the HC lets your block 'breath' better, is less restrictive :shrug: ...
PS, I'm getting a bit worried about the blocks inlet getting soft, you used Araldite did'nt you?. I'm wondering if silicone sealant would hold it in instead?. The outlets would be OK with it because they're a tighter fit and don't rely on the adhesive to hold them 'steady', but do you think the inlet would get 'levered out'?...