John I'm with you on the flex shafts, there great. I have used mine to engrave a tomahawk haft, but that a far cry from metal engraveing.
A friend of mine has a rotory tool that is made for engraveing, it turns at I think 500,000 rpm, it is neumatic and has a special filter/water trap. I think the whole set up was like 200-250$. Even it won't do real fine engraveing but it's great for carveing.