This kind of re-pivot can be done, even in hardened steel. If I have found this to be correct a size #80 drill bit is .343mm? That is massive 
If you look on ebay you do now and again see small sets of watchmakers drill bits come up, they are like tiny little spades and come in boxes with little wooden cylinders to hold the drill bits.
http://www.ebay.com/itm/EARLY-1900S-WATCHMAKERS-DRILLS-KIT-1-NO-RESERVE-/380572614672?pt=LH_DefaultDomain_15&hash=item589be54010
These drill through hardened steel, I know this because I have used them when re-pivoting french clock pivots and they dont come much harder than these. In my hints and tips section I showed how to make a simple flag to help guide the drill, I think Bob shows a thing like it in one of his videos (probably where my idea came from!).
Bob told me this probably wouldnt be accurate enough for doing watch pivots, shhh…dont tell him but I did a re-pivot of .55mm using this method. It is fiddly and takes a little while to set up but it can be done.
Try it, what have you got to lose? Dont run the lathe too fast, these drill bits dont like it.
As for making a new arbor, if it is an unimportant clock or watch, go ahead, if it is something with history and age then surely you want to keep the clock as original as possible?
Paul.
