Daniel,
Using a brake drum was one thing that was mentioned to me, but after talking with the machinist there were a couple of issues that swayed me toward using new material...
(1) The time spent turning it down and drilling it out would have been equal to or greater than the time spent starting from scratch with new steel and time is where my cost was in the machine shop.
(2) The machinist was concerned about the drum cracking during the machinig process due to the fact that it had been through so many heat cycles from years of being on a car and may have been "brittle."
(3) The face of the drum was much thinner than the steel we used and again, he was afraid of cracking during the drilling out of the certer or even worse, while it was on the balancer with a wheel attached.
In the end, we knew for sure that if we used new steel we wouldn't run into any of those problems, so that's what we did.
Additionally, a couple of people on this board suggested buying a wheel adapter from a VW shop or ordering one from a wholesale tire equipment company. That would have proven to be more expensive than my solution.