I got a plunge router attachment for my dremel mototool yesterday and used it to route a channel on the back of my guitar. It worked great. I also purchased a collet kit so I could use smaller shaft bits. I used dental drills obtained free from my cousins son who is a dentist.
For $30 this will be a handy addition to my tool arenal, and it should work very well for doing inlay routing, which I have yet to try!
Just wanted to pass this along. You can buy it for alittle less on the Net, but it is easier to return to Lowe's if there is a problem.
http://www.lowes.com/pd_2072-353-335_0_?productId=1058775&Ntt=dremel plunge router&Ntk=i_products&Ns=p_product_brand_name|1||p_product_description|1&pl=1¤tURL=/pl__0__s?newSearch=true$Ntt=dremel plunge router$y=8$x=21