I have to admit I have had success with the food processor, but I very much prefer making flaky pie crust by hand.
A few tips:
I highly recommend Rose’s cream cheese flaky crust recipe, the ingredients and techniques really do make a superior crust. The recipe is over on the blog, if you haven’t tried it.
If you can set the thermostat for something like 63F, it helps give you a little extra time to make the dough as you are not racing to keep the butter cool. I set the thermostat before bed, and mix the pie dough in the morning in the cool kitchen. Similarly, if you have warm hands you might consider keeping them off the dough or wearing gloves.
As for the problem of too much loose flour/not enough water, that could come from using a flour with too much protein (try Wondra, pastry flour, or a blend of AP and cake flour). It could also come from insufficient moisture-proofing of the flour with cream cheese (if you are using that recipe), and/or from insufficient rolling of the butter into large flakes (which get coated with flour, allowing less flour to float freely and soak up liquid).
To form the butter flakes, you can roll in a bag like Rose does, or if you find it easier you can dump out the moisture-proofed flour/butter cubes mixture onto a counter and roll it to form the flakes (this is what I do, a technique I had been using before I bought the Pie/Pastry Bible). After each pass with the rolling pin, I scrape up the flakes with a large pancake turner and layer them on top of each other, then roll again, until most (but not all) of the loose flour is stuck to large flakes of butter. Then I sprinkle the cream/vinegar over that, layer again with the pancake turner, and roll/layer one or two more times until it just barely looks as though most of it will hold together.
If you can’t work in a cool kitchen, I find it helpful to work in the large ziploc or on plastic wrap, and then two or three times during the process, put it all in the fridge on a pre-chilled sheet pan to make absolutely sure the butter doesn’t melt.
I don’t knead at all, the rolling achieves the same thing and I generally have a little shrinkage of the sides so I try to avoid any extra working of the dough.