First you make a sneaky gadget to hold the DTI face up in the tool post. Doesn't have to be on centre height, but you want it twistable and tiltable so you can point it at the centre line for an external or run it up against the inside of a pre-existing hole. If an alignment hole is small, find something that fits tight inside it. I have always had more luck lining up on a centre pip using the tool tip and turning the workpiece than using the tail centre. You can see better. You end up slackening one side a tadge then tightening the other, watch out if the piece isn't round/square/hexagon it is very easy to compromise the two jaws you didn't loosen. When moving it watch the DTI so you can stop at half the error. If you are using the chuck face for square, use the tail stock to hold it there while you adjust. Is that enough?