"Toller" writes:
I am using some coat pegs that measure 0.493". That is a pretty sloppy fit
in a 0.500" hole, but other than hoping I can find an undersized drill bit,
I am not sure what to do about it.
Presumably the glue will swell the pieces a bit; but will it be enough for a
secure installation?

You're talking about a 3-4 thou gap, I think the glue will fill this
just fine. However, don't count on the swelling - it may swell at
first, but it will shrink back again as it dries and regains
equilibrium.

If it bothers you, use epoxy instead of yellow glue. Epoxy is
structural, yellow glue isn't.