Well....here's an update:
I went with some of your suggestions and tried to drill and tap with a larger bolt. While this was successful for attaching the water pump to the timing cover...the timing cover started to leak where the broken bolt was. So, I pulled off the timing cover (what a pain the the ***) and gained access to the bolt. That was probably the MOST stubborn bolt I've ever seen. It was like welded to the engine block! After much trial and tribulation, I drilled the bolt out and re-tapped the hole. UNFORTANATELY, I somehow cracked the block in the process. The crack is extremely small (hairline) and away from any water or oil. (Basically, the upper right hand corner water pump bolt). Tomorrow, we will try to weld the crack shut.
And to think...I started all this because my car was running about 5 degrees to hot. (Yes - I changed everthing else first: thermo, radiator, flushing, etc.) But still...I am a dumbass.
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