That's a nice set there Bill...Seems ingersol rand doesn't make much in the US anymore...

I have a feeling a small dremel tool will cause nothing but grief for the material that's needed to be removed from the water pump housing.. As suggested a die grinder size bit will save you some aggravation... Harbor freight has cheapie air die grinders for around 10 bucks..
Here's a pic showing what happens to a normal single flute metal bit in short order when trying to cut aluminum..The two bits on the right side are aluminum cutting bits..There's a stick wax{made by castrol} that you can use to keep the aluminum cutting tools from clogging up I'll include a pic of it..