Just to update , Dremel and Dremel alike, 1/8" 3mm shank cutters, do fit nicely in supplied collet , been zipping through softwood with some Aldidl rotary tool cutters.

Proxxon tooling is 2.35mm diameter, different collet size.

Dremel branded tooling is ludicrously expensive, quite a lot of lower cost HSS and engraving bits available without the brand tag on them.