I did exactly that on my previous boat (a C&C25). It worked flawlessly.
If you drill a hole in the seat be sure to epoxy a piece of 1/2 inch or thicker plywood underneath to give you the rigidity you need.
I never had to lash the tiller to the autopilot -- I had bought the right size bracket and it never caused me any problems.
I bought a tiller pilot (ST2000+) for my 27' Catalina.
So now I'm thinking about mounting it to the seat, but then I have to get a bracket to put under the tiller to attach the pilot to. Is that a good solution? It seems like it would be difficult to get the pilot to stay attached to the boat and tiller--do you typically lash the pilot to the tiller somehow? Any tips?