I built flush pad eyes based on Pete Rudie's posts several months back. It is a little more involved than what you are sugesting but it looks good I don't have to worry about leaking.

Basically I have cherry plugs in the deck that have a 1/2" hole in them with a brass rod running horizontally through them just below the surface. The hole is deep enough so that the bungie can be threaded under the rod and is capped at the bottom. The Cherry hardwork looks nice and has the strength to hold in the brass rods.

here is the text , it was on 2/4 posted by Pete Rudie Posted By: Pete Rudie Date: Thursday, 4 February 1999, at 11:09 p.m.

Flush deck fittings are Good Things. They won’t kick spray up into your face, nor will they ruin the lines of your gorgeous new wood boat. Deck-mounted hardware can be unsightly and fragile. I haven’t found a commercial unit that quite fits the bill, so here is an idea for a good-looking, functional and watertight fitting that can be made to disappear into the lines of the deck design. This unit would be easy to make out of one piece on a lathe or drill press, but since my shop has neither here is an easy way to make it with only hand tools. Fabrication: 1. Choose hardwood for color, and get a piece ¼” thick. Cherry is a good match for dark cedar, but get whatever trips your trigger. (I got a ¼” x 4” x 12” chunk at Woodcraft for $6.99, wasted some on experiments, built 20 of the buggers for my two boats, and have half the piece left over.) 2. With a hand drill and a 1” O.D. holesaw, drill about 3/16” deep. This leaves a plug about 13/16” diameter. 3. Ream out the pilot drill hole to ½”. A stepdrill is self-piloting and does a clean job. 4. Rechuck the holesaw, back up the hardwood with a scrap and cut the rest of the way through. 5. Drill a 3/32” hole through the ring, along the diameter of the circle and across the grain. 6. Insert a 3/32” brass rod (under $2.00 for 48” of it at the hardware store) until it’s flush with the edge, and trim the end with a hacksaw and file. 7. For each ring, cut two 1-1/8” squares out of 3 mm or 4 mm marine plywood. Drill ½” holes in the center of half of them. 8. Prime all surfaces with epoxy. 9. Glue the sandwich together with thickened epoxy, the ring on top, the square with the hole in the middle, and the intact square on the bottom. Make sure the holes are concentric. Clamp them while they cure out. 10. When the epoxy gets to the green cure stage, trim the squeezed-out epoxy. 11. Coat all surfaces with two more coats of epoxy. Installation: 1. Drill a 13/16” hole in the deck (a Forstner bit works best, but a spade bit will do), and prime the raw edge with epoxy. Turn the boat upside down on the horses. Thicken the remaining epoxy, butter the flanges of the fittings, and install from belowdecks. Rotate them to line up the brass rods to your liking. Gravity will hold everything in place during cure. 2. When cured out, saw and sand the top flush with the deck and finish along with the deck. It won’t hurt a thing to have some epoxy flood the fitting, but don’t allow so much that the bungee can’t be threaded. 3. When finishing is complete, sear the end of the bungee so the fibers won’t unravel. Thread the bungee through with the help of a wire loop or pilot string. Most bungee configurations require passing through each fitting twice. It’s a tight fit, but here’s a trick to make it easier. Use some of the stout sewing thread that you used to sew the snap fittings on your webbing hatch cover straps. I used Beeswaxed 415 Nyltex Coreless, from Tandy Leather. Whip four or five turns around the end of the bungee and pull tight. Real tight. Trim one end of the thread short, and leave the other about 6 in. long. Thread the long end under the brass rod and the rest is sure to follow if the knot is tight. The above instructions are for a 5/32” bungee on a ¼” strip-planked deck. The 1/8” spacer allows enough depth to thread the bungee. For different sizes of bungee or nylon webbing, or deck thickness, adjust dimensions accordingly. Make sure the brass rod remains at least one rod diameter below the deck after sanding so that it won’t pull out. The bottom square can be glued up out of the same strips as the surrounding deck, to maintain design integrity. Watch the orientation of the grain during glue-up and installation. These things can be used to attach deck lines and end toggles as well, if you install them before the deck and hull are glued together. They can be scaled up for webbing, too.