I tried mine in a bucket, with the cutting edge down in PVC (reverse of yours). I put a layer of foam on the bottom to cushion the cutting edges. worked for awhile, but now I have my tools in a wall cabinet that holds 24 tools, with magnets holding them up.
I would shy away from magnets if you are using steel/cast iron tool rests. The tools become magnetic which can cause the tool to drag along the tool rest. All my rests have the stainless steel rods on the top so no problem.
Gordon