The touch blocks are just to fool the firmware into thinking the board is down on the belts and that it is measuring the board thickness. The touch blocks mimic the touch points at the brass roller and at the sliding plate. The drilled hole mimics the hole in the sliding plate.
The Forstner bit just gives a clean hole. A brad point bit would as well. Drill the holes any way you can. A regular bit as you say though some scrap should work.