13/32 is the correct drill size and will allow enough clearance for a snug fit with the Nichols 10mm bolts. You will also need to drill out the frame bolt hole and the threaded end of the frame using the 13/32 bit.
I recommend the following:
1) Keep the factory bolts in place but back them out enough to allow for drilling of the frame.
2) Use a low speed electric corded drill
3) Use WD40, motor oil, or tapping fluid when drilling
4) You will most likely need to drill about 1.5" into the engine casing to allow for the bolts to fit. My 944 motor has 900ss engine casings (yes, odd I know but they are compatible) and I had to drill them out. When drilling the aluminum apply slight pressure to prevent the bit from grabbing the softer aluminum. If the bit does grab, reverse the bit, bring the drill to full speed then slowly reapply pressure to the drilling surface. Do not apply twisting force with your hands on the drill to get the bit to continue cutting.
5) When drilling the other side, remove the stock bolt and insert it from the otherside to keep the motor aligned.
6) Once both sides are drilled, remove the bolt and blow out shavings from the bolt hole.
7) Apply assembly grease or anti-sieze to the Nichols bolts when installing them as this will ease assembly and removal in the future.
8) You can apply thread locker to the nuts if desired. I used anti-seize which will prevent galling of the thread and potentially seized nut/bolt which would be very difficult to remove later on.
I attached a pdf file of the Nichols bolts install instructions.
Also be sure to center the nuts as described in the install instructions. Since you have a 900ss all the nuts should be the same unlike other bikes which use a shorter nut under the battery area.
And you don't need a very long bit. Just a standard jobber length bit, not a bit to reach from one side of the engine to the other. The bore of the engine mount castings are of smaller diameter (the area requiring drilling) about 1.5" into the casting on each side of the engine. Further into the bore the diameter becomes larger and does not require drilling. Shine a flashlight into the hole with the bolt removed and you'll see what I'm talking about.