The wood I use for these is normally small pored (not Oak, or any similar large pored wood) and of medium hardness. This makes the cylinders soft enough to be carveable, but hard enough not to deform under pressure. To that end, Walnut is ideal, although I have made cylinders from Padauk (pictured), California Bay Laurel, and Yellowheart. Yellowheart was a little too hard, I don't want to do that again!
I cut cylinders of wood out of thick blocks with a hole saw in a three step process.
Step 1: The Pilot Hole
Step 2: First Cut With the Hole Saw
I use the pilot hole to start the hole saw, running it down as far as it will go, and lubricating it with beeswax. The depth of the hole saw should be more than half the thickness of the wood, otherwise you won't be able to get the cylinder out without resorting to a bandsaw, or something similar.
Step 3: Second Hole Saw Cut
I then go in from the opposite side of the wood, guided by the center hole made by the pilot drill. You will feel a difference in the drill press resistance when you go through. It will sound different, and the torque applied to the wood will relax.
Step 4: Remove Cylinder From Wood
I then take out the cylinder. It should have a flange part way down the side. If you made the roller seal without getting rid of the flange, you would have a depressed line going the length of your final image.
Step 5: Lathework
Step 6: Carving
Step 7: Finishing
If you like what you have made, it's time to put a finish on. I normally use Behlen's toy and butcher block finish, although another nontoxic top coat is fine. It will allow you to use the roller seal on food material, such as dough.
Step 8: Waxing
I then polish it with a buffer set, finishing it and waxing it. for that process, After the finish is applied, and dries, I rub the cylinder with steel wool. I then buff it with white diamond polishing compound, then apply wax. Beeswax will work, but Carnauba works better, as it is harder, and will give you a good shine, as well as slick nonstick sides. It is available at woodcraft stores, woodcraft.com and other places as well.