You know how a two-lipped drill tends to want to make a three-lobed hole? Well, the Watts drill takes advantage of that tendency to wobble on the drill lip points, and, with a three-lipped cutter, chews out a pretty square hole. Other shapes can also be done that way, five, six, etc.
My favorite square and hex hole tool is the rotary broach:
Do a quick Internet search for "Watts drill," and you'll find good explanations of how these things work. They've been around since 1918, and take advantage of the tendency of drills to wobble on the points of the cutting lips. You know, how a two-lipped drill tends to make a three-lobed hole.
Here's a good item from MakeZine, with a nice illustration:
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