I went last Friday to have 2 holes drilled in my 200 gal tank. Due to this post I asked them how they did it. Keep in mind this is a tank supplier to all our LFS here. He told me that he uses a 9 dollar wood holesaw, grinds the teeth off and uses a compound that is silica carbide. He tells me that you can get about 120 holes drilled with that then you have to replace the holesaw. He also said that you dont have to grind the teeth off, but they will be gone after several holes. This grit is like 2 dollars a pound, and the bit it roughly 5-8 bucks. He did use a drill mounded on a trrpod, so I dont know how easily it will go by hand. It took about 7 or 8 minutes to drill mine.
Good Luck,
Jeremy