This is a great post and some very useful information is coming from it!
A friend of mine uses cap pivots and if that is the route you wish to take then that is up to you, the cap jobs I have seen from my friend have not impressed me as it is not in keeping with the original look of the part. If you are using a cap that requires turning down the diameter of the arbor to then be pushed on so the arbor is all the same diameter then this would be acceptable on an antique.
With regard to capping a balance staff, this is something I have not seen done. If you are having a to use a few processes to get a cap to fit surely it would be better just to learn how to turn a new staff? This is a skill that would be used time and again if you are going down the pocket watch route as there are plenty out there with broken balance staffs.
Is capping a balance staff something anyone has done? I would love to see pictures and know about the exact process. Also how long would it take to do this as opposed to turning a new balance staff?
David, I understand completely where you are coming from on the drilling a perfect hole. As a standard process the pivot must be burnished after the new pivot is put in and if you are at all worried about the concentricity then you can always insert a piece of pivot steel of larger diameter than needed and then turn it down to size. This should be standard procedure for a re-pivot anyway. I hope you didnt think I was questioning your advice on this, I just wanted to let you know from my own experience that it is a perfectly acceptable way to repair a pivot and that the finished product is concentric(As concentric as my collets will allow anyway 
There is no wrong way to go about a job as long as it provides a good job at the end of the process it does however help if you find a method that is quicker than another and produces the desired results.
Paul.