As others have said, a lathe or milling machine is by far the best and safest way to go. I would not recommend using a drill press.
A good router can cut aluminum. I'm assuming this is a relatively soft alloy, e.g. 6061, and it hasn't been heat-treated. I also assume you have a 1/2" arbor on the router and the end mill is also 1/2" diameter. Here's how I would do it, if all I had was a router and an end mill:
1. Fabricate a fixture from plywood that will securely hold your spacer. The sides of the fixture should be higher than the spacer, so your router base can rest on the sides. Because of the size of the router baseplate is about the same as the spacer, you'll probably need to replace the baseplate with a piece of plywood big enough to span the fixture.
2. With the mill in the router and the router on the fixture, adjust the router depth so the mill just touches the spacer. Then slightly lower the router and make a pass across the spacer. You'll know immediately if it's going to work.
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