Hey Dean,
Just a word of advice from personal experience...your Dremel device may get you through this one project, but I doubt that the lateral thrust on the dremel bearings will hold up for much use of this nature... that is the reason that tool post grinders are so expensive, they can take the punishment... If you are "building your own" tools, a better substitute might be a motor/chuck combination from a quality wood router... I picked up one (an older craftsman) once at a yard sale for ten bucks, and used it in the fashion you are using the dremel and found it pretty satisfactory if you make the mount stable enough... BTW, Craftsman tools have a pretty good warranty, so if you don't butcher the parts you could reassemble it and take it to sears for repair if something quits under duress...
Keep up the good work. I can't wait for the next installment.