That would work. I'd drill the pivot hole first, using the flats of the nut to clamp it in the vice. Next I'd round off edges using a file or belt sander. Then a dremel or hacksaw to remove the excess material on the bottom of your image, finally using a nice sharp file to shape the shoulders. Use a machinist's file that has a smooth edge so as to only file what you need off. Should take about a half hour to an hour.
Hard to tell what kind of steel you're getting. Remember the graded steel nuts (grade 8 and etc) are only hardness, not alloy. McMaster says it is alloy steel, my guess is 1018 so it'd work.
Hmmm, I should start offering to make little parts like these for trade.
Last edited by phuphuphnik on Sat Mar 15, 2014 2:34 pm; edited 1 time in total (Reason for editing : added an emoticon to convey a good natured idea, not a commercial intrest)