I think your best bet is to use a trim router.
If you just want to rough cut a hole and aren't too particular about the results, you might try a RotoZip. Everybody I know that's tried one on wood has been disappointed, but if you're just roughing something in the results might be acceptable.
If you don't have much to do, you could try the Dremel.
You could look into power carving tools, though I'm not sure how accurate they'd be. Something like the
Merlin from King Arthur's Tools or maybe some sort of flex-shaft carver? I think there's an attachment you can get for some flex-shaft carvers that adds a reciprocating blade to the end of the shaft.
You might investigate using a pneumatic cut-off wheel. Not sure if you can get wood-cutting blades for them, but the ones that use little 3" or 4" wheels are pretty small.
Proxxon makes lots of miniature tools. They're typically used by jewelers and people building scale models (think: wooden ships). I get the impression that they're pretty pricey and of limited utility when building full-scale projects, but it might be worth a look.