Yes , hardened and ground . Could you possibly drill and tap for a set screw ? You could definately drill it , but tapping may be an issue . You could go with a roll pin or dowel .
Hard to say not knowing what the desired results are .
It would be handy if the metal could be tapped as well, but there are workarounds if that's not possible.
I'm thinking about a fixture for making custom milling cutters, all the way from countersinks to tapered end mills. I'd use O-1 or its equivalent, cut (straight) flutes then harden & temper the tool. A precision block would make it much easier to fabricate multi-fluted cutters.
The block would either be mounted on a rotating stage or be drilled for a dowel pin that would be used as a pivot. The work would be turned to the deisired angle for what I want to make -- 45 degrees for a 90 degree countersink, all the way down to a few degrees to fabricate single-tooth gear cutters. Zero degrees would give me a reamer. I'd also use an indexing ring attached to the work to rotate it +/- a few degres in order to get my relief angles -- that's where the drilled/tapped hole in the block would come into play.
Before milling it, the work piece would be turned on my lathe to make a correctly-angled cone on the business end...except for reamers, that is. They really aren't my focus anyway
I'm in the what-if stage so just mulling over some ideas. I can do the same thing by making my own block and holding the work with set screws, but an ER collet block would make it a lot easier to use different-diameter stock. But the other side of the coin is that I'd need to start with a longer piece of steel, because it would have to extend past the end of the block where I'd attach my indexing ring. A home-made holder would permit me to put the ring on the front. The ring only needs to be wide enough for a set screw.
It also isn't out of the question to clamp the ER block to a carrier (made out of softer material) that would have the requisite holes I need, and just live with the longer cutter (or shorten it before hardening it). Decisions, decisions...