What is the best tool to open up the holes in the peg head/headstock just another 1/16” they are open to 1/2” but the Hipshot nuts on the ultralights are just a smidge bigger. Not thinking I’ll have much luck finding a 1 1/16” drill bit.
I think you mean a 9/16" bit
A reamer is the tool to use. I'm sure Stewmac has something nicer, but I have a set like this:
https://www.amazon.com/LifCratms-Tapered-Reamers-Chamfer-Woodworker/dp/B0BXG6N1PL/ref=sr_1_5?crid=1CVI4AORSGPQD&keywords=tapered+reamer+for+wood&qid=1698003828&sprefix=Wood+reamer,aps,203&sr=8-5&th=1
I picked up one of the reamers from Harbor Freight and it works well for this type of thing. Probably the same (or very similar) reamers sold in the Amazon listing Irv posted.
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GLWTS