While drilling and chiseling the inside I did break the back door off in half accidentally, but I think it will be a good thing because I wouldn't have been able to clean it out much less sand if smooth. I used the dremel carving tool to get it mostly cleaned out and the next step will be sanding using both dremel sanding drums and the 2" sanding circles that also attach to the dremel.  The inside of the main trunk was a trial and error process.  I started using a burr rasp that attaches to a drill, but it wasn't very good at getting rid of all the lumps and bumps, and was hated to manage.  I switched to trying the dremel, but that was just too small.  I thought about the angle grinder, I had used it for years with a rigid base that attached sanding disks, not for building projects but to trim pony and donkey feet, was quick and easy and just took offf a little at a time.  My angle grinder is a 4" not a 4.5", but I have disks in both 4 and 4.5". The 4.5" ones hange over the rigid disk and that proved to be an asset while trying to get into the curves of the trunk.  I was wearing safety glasses during this process but discovered that some of the little bits of wood shot out rather forcefully and resorted to leather gloves to protect my hands.  Most of the smoothing was done with 35 and 50 sandpaper disks. The inside is now smooth, and I was able to rapidly clean out some spots I couldn't get to withthe chisel or drill.  After getting it mostly smooth I added glue to some sawdust and filled in some places around the balcony opening.  

The next step was going to be cut an opening in the front to hinge for access to the inside, but I backed up and decided that a roofline should be astablished first.  I decided on a round roofwith a peak in the middle, maybe curved at the end, kind of like a whitches hat.  I made several attempts this week making a structure for the roof, and learned what I didn't want.  The first two peaks were too wide, and now I am going to do the gently curved part first.  The back of the stump is taller then the front, making it more challenging, plus it will end up being more of an oval then a circle.  I want to put a dormer in the peaked part of the roof.

The following two pictures are after using the angle grinder to smooth the inside, the first one shows more clearing out using the grinder.  The next two are a picture of the top where the roof will be, you can see the back is higher then the front.