A fly cutter looks like a drill bit with an arm sticking out of the shank of 
the bit.
Thereis a second cutter fasten to this arm on a sliding arrangement.  You 
adjust the distance
between the main bit, center, and this extra cutter for the radius of your hole.

Since the entire thing is off centeer and unballanced, it is unsafe
to use it in anything but a drill press that, as Dale says,
keeps it ballanced and true.

You got this arm and cutter flying around in circles right out there with 
nothing
between it and your body.

I wouldn't even use one in a drill press.

There are similar, smaller, devices, I think called adjustable bits, for 
a brace which you crank by hand.  Not so bad as you have control and it's slow.

NNot sure they come as big as 2  inches.

If I had to do this job on the cheap, I'd do it with the marked hole
and many 1/4 inch  hole method and a gouge.

|tom

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