So, next chapter:
First thing I did was size the holes up to 4.2mm and ream them up to 4.5mm. Reaming makes for a smoother tighter fitting pivot hole - this is another thing that will help improve your action.
Now that the holes are the correct size to fit the pivot, we can accurately drill the mating hole for the ball detent. The location of this hole is very important and actually should be worked out in the design stages. In the image below, the ball needs to be within the red circle, if it's outside the ball will run off the blade during opening and closing which is not what you want.
Now that the first hole (the one in the lock that, the ball will be pressed into) is in place, assemble the blade, the locking liner and the spacer:
I get the blade into the position I want it to be in the closed position and draw a line along the back of the blade with a fine sharpie (you can scribe it but it means one more scratch you'll have to sand out!)
I then remove the spacer and rotate the blade a couple degrees
past closed. You can see the gap between the spine and the sharpie mark:
This is how you want the parts when you drill through the liner, into the blade. This will cause the blade to be under tension in the closed position.
The tension I'm talking about is created by the offset. It's important because without it your blade would wiggle a little when closed poteintially baring the tip of your blade - definitely not what you're after.
Here's a close-up view of the offset you're looking to create:
Get this offset right and your blade will snap shut nicely and stay closed in the pocket.
Drilling into the blade:
You want to drill a minimum of half the diameter of the ball
or more. Less could affect how the ball seats, you can drill all the way through if you like, I often do.