Making holes for panel pots and switches has always been a major pain in the butt for me.
I tried lots of times to make different sized holes with standard metal drills on tin sheets but the holes always came out at the wrong places or, due to the fact that I don’t have a drill stand, triangle shaped because of my inability to keep the panels from sliding up and down the drill. They also came out with lots of scrap attached to them (I cannot find the right word but I mean the metal goo that remains at the opposite side of the drill entrance).
Today, I received in the mail a… STEP DRILL!
Didn’t know it’s existence till recently but using it has been a revelation!!!
Also I got three tools to make the holes tapered (the smaller two are pictured).
If you are careful with the step drill you get instant holes at the desired diameter (the numbers on the drill are mm). And since there is a taper leading to the next, larger diameter on the drill, you get instant metal-goo cleaning and flattening. No more scrap at the holes…
The following is a 5mm hole. No other tools used!
Below is a 5mm hole but treated with the taper tool afterwards. You can house nicely a 3 or 4mm screw with tapered head.
And the big one.. 10mm for audio jacks and some cheap pots. Instant gratification.
Same rules apply though. If you want to be as exact as possible, first start with a small drill (eg 2mm) to mark the center so as the step drill has somewhere to land.
I would really like to know how other people make their panels and especialy the square shaped holes. This has always been a mystery to me 
Cheers!
I’ve made square holes in the past with a nibbler.
Does the nibbler work for thick sheets? (like 2mm eg)
likely depends on the particular nibbler one nibbles with – mine successfully chomped 2mm snacks tho
Of course Harbor Freight is the bomb when it comes to step drills:
http://www.harborfreight.com/cpi/ctaf/displayitem.taf?Itemnumber=96275
The first picture shows you need a better quality step drill and a drill press.
Second picture shows that you need much less pressure when tapering a hole.
Always let the drill do the cutting, you should not need to push the drill all that hard, if you do you need better drill bits or a faster drill.
Indeed the step drill was of the worst quality available (I got the cheapest on ebay just to try it out). But now I’m on the hunt for a good one!
I've made holes for 25 pin RS232 ports with a punch before. Granted… it's a specialty tool (especially now), but it does a great job. For rectangle holes try this link. http://www.mygreenlee.com/Products/main.shtml?greenlee_category_id=2&product_category=143&adodb_next_page=1
If you really want precission cut holes for various projects get a knock out punch. Tool manufacturers such as Greenlee sell basic kits and specialty dies.
I think the word you are looking for describing the metal goo that is on the exit side of the drill hole is “swarf”.
In the past I've used brad-point (or lip & spur) drill bits for cutting holes in panels. They leave a tiny bit of swarf on the back face, but usually not much, and they normally make quite a clean hole.
Here's a wikipedia link to what I'm talking about. That article suggests they can only be used for soft metals – I've used them successfully on aluminium & plastic panels, haven't tried steel, though I guess you could use one to score the panel from both sides before using a conventional drill to cut through. A drill press is a definite must if you want any sort of accurate holes, though. Cutting aluminium with a hand-held drill makes it very difficult to get round holes…
I don’t know how I got along with out put a step drill.
Drilling is so much easier with one.
BTW I’ve always called it “chaff,” that metal goo you get .