I found this forum interesting because I have a project that requires plugs. I recently cut 15 oak plugs from the inside of a craftsman style bookcase. I figured I'd try the cheapest method and work up till I found one that is acceptable. So, I started with a Japanese style pull cut saw. I found this one online:
It indicated there is there is no scratching of your work and at $24 it is a good starting point.
"Wooden Nail Saws are used to trim wooden nails and plugs flush with the surface of your work. The blade is thin and flexible, so when in use, it can be bent with a portion of the blade held flat against the work surface. The teeth have little or no set to avoid scratching your work. These saws are also great for cutting a fine kerf in small work. Blade length is 6; overall length is 13 with 19 tpi. The handle is make from African Rosewood with brass attachment screws. The blade can be easily replaced if necessary."
It worked absolutely wonderful! There was absolutely no scratching of the surrounding area and it cut clean and flush to the surrounding area requiring no sanding because of marks (I did sand just because though). It took only a few minutes to cut the 15 oak plugs. I actually was able to cut 2 plugs at a time because of the layout. You just place the saw blade under the little overhang and pull (much better than a push cut). In the words of Mike Meyer - "like butter".
Kreg needs to come up with a solution. I've found trimming the plugs could be dangerous if cut prior to installation with anything power tool. And once in, makes it difficult to not mar the finished work.