one stop tool?

Maggie, it would be a good tool to have. It can do many things. As for modding cobs that will depend on what you want to do.

Sorry No, look for a table top drill press or use caution and use a hand drill. The hole for the shank is about .375" to .50". The bowls range from .50" to .85". Look around you might be able to find a used one fairly cheap. Also look in Lowe's or Home Depot they may have one new for about $100.00.

The Dremel tool is a great tool for what it is, but for pipes the dremel that doesn't have variable settings, operates at too high Rpm's.
The small surface area of the buffing and polishing wheels make it a less than ideal tool.

Drilling can be a tricky proposition, even when simply opening up an airway is the goal, I wouldn't try it unless it was a pipe that I would be ok if it was destroyed in the process.

The pipe makers forums are the best resource when asking questions of this nature, certainly we have a few pipe makers on this forum that have better advice than I, but over there they are really equipped to answer questions best relevant to pipe making and shop equipment.

The Dremel tool pictured is battery operated and I can tell you from experience they don't last long. If your interest still lies in getting one, get one that runs on 110V you'll be much happier. As for using a Dremel I have many but, only use them for cutting my stem slot, occasionally help smooth out places that are hard to reach with files and the occasional rustication. Some pipe makers may have more use for them but, I prefer to do most things by hand because I have more control. If you've ever slip with a Dremel in hand you certainly can cause some damage that may be unrepairable. I would take 10furlongs advice, start slow and be patient. Doing what you wish to do can't be done on a whim, it takes time to learn how and to train your hands to do what your eye wants.....if that makes sense. I started making pipes in 2013 and I still haven't accomplished it.

Oh, I took modding as modification and your comment to the shank thinking you wanted to do something else.
Well, a Dremel would be your best bet then and one with variable speed would be the one you'd want cause they generally run very fast and to do what you want to it would be better to start at about half the speed. You can sometimes find them on Craigslist, garage sales and the like used for pretty good prices.

I'm unsure how you can drill the side of the bowl to accept the shank without a drill press and be accurate and not drill too deep. I've never seen one of these kits either so I'm sure how to go about tackling it. My only advice would be not to try it with a Dremel tool and it's nothing I would attempt with a hand drill, could be very dangerous.