Andrew,
Another way is with a file or plane. This method is described by Keith Julier in his colunm in March (I think) issue of Model Boats.
Briefly, you file or plane the dowel, tapering as required, firstly square, then octagonal. Finally round off with sandpaper.
As Footski has advised, a drill and sandpaper works well for me. A battery drill is better than mains powered, as the rpm is generally lower.
Plugger