On diamond drill bits... Well, technically they're hole saws, but I'm using them as if they're drill bits. One of the characteristics of these diamond bits is that they wear out pretty quickly on hard substances (like the porcelain tiles in our bathroom). I've been getting 8 - 10 holes from each drill bit, and they're about $15 each – so it's costing me over 50 cents in tooling for each hole. That's not something a homeowner generally has to worry about with drill bits :)
I got to wondering exactly how these bits were made, and what they look like close up, so I stuck a used one under the microscope. This one still has some life in it. In the left hand photo (about 15x) you can see the composite of metal and diamond chips that make up the working surface. The white “frosting” is dried porcelain tile powder from the last time I used it. When drilling, I keep the bit wet, so the ground off porcelain forms a kind of slurry or mud that sticks to the drill bit, then dries very hard. The diamond chips are transparent, and pale yellow or green in color. I have no idea what kind of metal they're embedded in. The right hand photo is centered at the same spot, but I zoomed it to 60x; in it you have a clearer view of just those chips.
I couldn't see any of this with just my eyeball. With my fingernail I can readily feel that the surface is rough, but to my eye it just looks like a matte-finished metal surface. It's very different when magnified!