There are two ways to do this.  One is to relocate the capstan.  Plug
the old hole with an actual plug, not a dowel.

The other way is to install a Dutchman which is slightly larger than
the section removed thus altering the direction of the rear portion of
the key.  I have added photos of this repair method on my web site:

  http://pianocapecod.com/ 
  http://pianocapecod.com/Cape_Cod_Piano_Tuning,_repair,_sales,_rental/Photos_Repairs.html 

Jon Page