For turnign on a metal lathe where you hold the stock in a chuck you put the drill in the tail stock. The material turns and the bit is stationary.
On a wood lathe you put the drill chuck in the HEADSTOCK and let the bit turn. You can either leave your live center or use your spur center in the tail stock and slide the tailstock up the ways while holding the plug and "line bore" the thru wire hole. Capesams put together a nice presentation along with photos somewhere here in plug building.
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