I NOW have a cross slide cast iron vice so I can center the part dead on. However I will use a center bit first. But since I did drill with both 3/8" and 1/2" through holes in the same material without any issues, other then the hand-held vice spinning around and smashing my hand as it broke through the 1/2" hole, I managed to drill straight through without a step drill effort.
But now I have the cross-slide vice solidly bolted to the cast iron table at three locations. And I can adjust the setup and keep my hands away from the spinning action as well. I still will use oil and stop for chip clearing, but I think I will go for it without steps. If I screw it up, I have more material...
Thanks for everyone's suggestions. Pretty much mimics what I was thinking. I initially had in mind to chuck up the part in the metal lathe and drill a 1/2" hole and then use a boring bar cuter to finish up to the proper size. BUT, pretty hard to chuck up a square 1" bar stock in a three jaw chuck. Oh yes, it can be done, but with more effort then I want to try. One day I will own a independent four jaw chuck and then it would be a breeze to do that method. So drill press it is...
I actually tried to ask that same question on the internet. But as soon as it seen the "step drill" part of the question, all it did was post step drill bits to buy. Never any answers to what I was asking. Don't you love the "smart" internet?
Thanks to all respondents. I really do appreciate your opinions...