The simplest solution is to drill the dowel hole after you fit the joint together.
Fit the joint and make sure everything's square and true, then drill straight through the mortice and tenon in one go and insert the dowel. Chisel/plane and sand it flush and you should be good to go.
Making a mark on the outside of the mortice where you want to drill will ensure you get the location right.
It might be good to consider a sliding dovetail.
![enter image description here](https://i.stack.imgur.com/iVHb3.png)
Edit 11/16/13 To assemble your bed frame, the M&T joints with captured bolts with nuts to hold the corners together with the legs.
Just as a mention, a good hardwood needs to be used for the assembly. regular 2X4, 2X6s and other similar materials used in the construction of homes will be too soft, and when the joints are put under stress SPF, Hem fir, etc is going to compress and loosen the joints. To use this material you need glue and screws to hold all this together. That is not an option for you I think?
To assemble this, white oak, ash, Black walnut and a dense variety of mahogany would be a good choice, if it is not cost prohibitive. There are other hardwoods too, just give a look. Red oak and Douglas Fir are hardwoods, but very prone to readily split under the stresses you are going to expose the joints to.
Another good thing about some hardwoods, is that you will not need the same dimension of material to have the same strength as 2X framing lumber.
The sliding dovetails are ideal for the cross members into the side rails. To use the same joint for the attachment of the legs would produce a weak joint in my opinion, I have seen it fail in pedestal table legs.![dovetail at leg](https://i.stack.imgur.com/o4JeT.png)
To dissemble this in time, and to ease the assembly, which sliding dovetails can be a bear to slide together, I suggest tapering the dovetail so as it goes in, the joint gets tighter, it doesn't need much, a 1/16th of an inch over 4 inches on each side would dramatically increase the ease of assembly/disassembly. A router jig with a bushing guide on the router would make the female cuts in the rails, and a router table with a tall fence and a shim on the appropriate corner of the support for the slats would cut the male dovetail. A push bock would be handy to control the top heavy stock for this cut.
Best Answer
Yes, if...
The means by which you fasten the ends of the knee braces to your structure is adequate. It must be very rigid so no slipping or flexing can occur. There will be substantial shear and tension forces at play. Your mortises should fit snugly.
The posts in your structure are rigid enough. They'll carry a significant amount of bending force due to the longer torque arm that the shorter braces create. Just how much depends on the ratios of braced to unbraced length you go with. I probably wouldn't do less than 1:3.