If you insist on diamond for grinding, then you should try diamond paste (40 or 45 grit) on caste iron or mild steel plates. I made caste iron plates from broken Stanley planes, while the steel versions can be purchased from Lee Valley. They are good - I use one from pre-production testing. (Don't be tempted to try the paste out on MDF - it is too soft).
I also would not recommend waterstones for grinding. Few, if any, are hard enoug to remain flat when grinding. They remain effective by exposing fresh grit as they wear. This needs to be often. This is, in fact, my major criticism of diamond stones - they do wear and they d not open up fresh grit. Their life span is quite limited.
The long departed Alf (where is she btw) was a huge fan of the hand cranked grinder - RobCheshirechappie":2yw8e2wu said:For anybody wishing to avoid power tools (especially high speed dry grinders - or offhand grinders as our engineering colleagues like to call them), may I suggest scouring the interweb auction sites or secondhand dealers for a hand crank grinder? Not as fast as a dry grinder, but faster than any flat abrasives, and controllable too, and just about light and compact enough for a mobile toolkit. Try to find one with a 6" wheel - replacement wheels will be easier to find if you need to do so. The toolrest may need modifying, but keep it simple - do the guiding with your hand and eye, which with not much practice are more than good enough - you don't need fancy jigs.
If you want to get really fancy, buy a couple of replacement wheels, and with a diamond dresser, reshape them to curved working edges (make a wooden box to keep the profiled wheels seperate from each other and safe, and you'll be set for life.) You can then regrind in-cannel gouges, hollow plane irons and the like; doing these on a power grinder is only really viable if you have lots to do, as setting a grinder up with profile wheels is not really something you'd do for a one-off.
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