I never end up being happy with a dremel. just not fun to use.
I would really recommend cutoff wheels on an angle grinder. and a drill press- any drille press, cheap, small, whatever. handheld drills want to go too fast.
I'm not sure I'd really enjoy wearing down files trying to make a 1/4 inch spined flat grind, but I've done a few knives with nothing but the files and paper. SMALL ones, and THIN ones.
Aside from the hacksaw (granted, I have 4 in my shop, all GOOD ones), it sounds like a fine setup for taking your time.