Celtic knots are exercises in precision craftsmanship. The key points are:
1. The cross section of the blank needs to be as square as possible.
2. The saw kerf width must match the thickness of the inlay. Errors here will result in misalignment of segments of the knot.
3. The saw kerfs must be done in a precisely repeatable fashion. I suppose that a chop saw would work, but the best approach is to use a jig.
4. The cuts should not go all the way through the blank, but rather be only kerfs that leave a thin (1/16" or so) intact strip of the blank. That thin strip keeps the blank aligned so that all you have to do is apply glue and slip the inlay into the saw kerf.
5. Make sure your saw blade is sharp - a dull blade will scorch the wood adjacent to the saw kerf, and the scorched wood will be obvious when the blank is later turned. But DON'T use wax on the saw blade - you have to glue the inlay to those cut edges and while waxing the blade will result in cleaner cuts, it will inhibit gluing..
6. I find the best approach to gluing is to use a good PVA glue (Titebond) and allow enough time for the glue to cure before cutting the kerf for the next inlay. I put glue on both sides of the inlay, and then use that to spread glue on the sides of the saw kerf. Making celtic knot blanks is not something you can knock out in an hour or so - I prefer to make it a quasi-production process where I work on several blanks simultaneously, and take a couple of days to finish those blanks.
7. Allow the glue to cure for a week or so before turning. If you turn too quickly, you can produce a smooth finish only to find that a glue ridge appears several days later.
8. Drill as precisely as possible. If the drill wanders off center, the final knot won't be symmetrical.