Dan,
That looks like a good idea. I saw another air drill on ebay recently. I went looking for it but couldn't find it. Check out the link here:
http://victoryplasma.com/victorycnc/currentimages/
I am not sure if those are "real" pics. I think you would have to drill before you cut or clamp and re align. Their drill head looks like an air system.
How did your oxy/fuel project go?
WSS