Sounds like you and I have the same thoughts on machining the inserts. I use a harbor freight metalworking lathe and do almost the same thing. I centerbore the squares, then using an arbor made of 5/16" and I made some bushings that fit against the ends of the square, tighten lock nuts against the bushings then I also use a HSS cutter and maching them with no more than .020" per cut until I get to within 10 thou of the finish diameter of the insert. I finish it off with 4 grits of sandpaper turning at 1200 to 1400 rpm, the last pass being with 800 grit paper to polish the insert. I only get the small voids when turning a really open grain wood. Like you I am still a hobbyist and I guess one of the most enjoyable things about making your own is making all of the tools that it takes to get the job done. Fun stuff!!!