The other less popular method is to use the Grantha Letters. The present Tamil Orthography has already absorbed and completely nativized 5 Grantha Letters, which are de-facto part of the Orthography. However, the General public do not make any distinction between the Tamilized Grantha Letters and Tamil Letters per se.

Grantha Script is a complex script making extensive use of conjuncts. Hence, efforts were made to reduce the difficulty in reading Sanskrit, by filling up the holes in the Tamil Script with the Grantha Consonants. There result was a hybrid between the Tamil & Grantha Orthographies.

One of the Earliest efforts of such a Hybrid Tamil-Grantha script dates back to the 1900's where a complete book was published using the Tamil-Grantha Hybrid Script. Infact, the Tamil-Grantha hybrid script is ideal for a beginner to learn and read Sanskrit Text properly. Once familiar with this, it would easy to learn the full Grantha Script.

Below, is a direct sample for a book called "Bhoja Charitram" published in 1916, along side with typeset version of the same passage with e-Grantamil font .

A commentary on the Jaina Epic Nilakesi published in 1936 also uses this technique now and then. ( See MinTamil Google Group)

There also been other recent publications which use Tamil-Grantha hybrid for printing Sanskrit.

Tamil-Grantha Character Set

Vowels

Consonants

Consonant-Vowel Combinations

Tamil Letter "ka" taking all the vowel signs.

Grantha Letter "gha" taking all the vowel signs.

Those in Red, denote the hybrid charset. Except for Ksha & Shrii, Tamil-Grantha does not use any other Conjuncts. The Explicit Tamil Virama "Pulli" is used instead.

Display Issues in Windows 7

Windows 7 does not render all the Script blocks present in the Same font. It displays only a single block correctly, the other blocks in the font, get a fallback rendering. Since, Tamil-Grantha Hybrid used codepoints for Bengali & Tamil from the same font (e-Grantamil), this resultant text will not get rendered properly in Windows 7. This is due to a bug in the Windows 7 Unicode rendering. (See: Unicode Mailing List : http://www.unicode.org/mail-arch/unicode-ml/y2010-m03/0004.html ) 

Sample Sanskrit Text

अनिरोधम् अनुत्पादम् अनुच्छेदम् अशाश्वतम् ।

अनेकार्थम् अनानार्थम् अनागमम् अनिर्गमम् ॥

यः प्रतीत्यसमुत्पादं प्रपञ्चोपशमं शिवम् ।

देशयामास संबुद्धस्तं वन्दे वदतां वरम् ॥

அநிரோধம் அநுத்பாদம் அநுச்‌‍‌ேছদம் அশாশ்வதம் |  

அநேகார்থம் அநாநார்থம் அநாগமம் அநிர்গமம் ||  

யঃ ப்ரதீத்யஸமுத்பாদং ப்ரபஞ்சோபশமং শিவம் | 

‌‍‌ேদশயாமாஸ ஸংবுদ்ধஸ்தং வந்‌‍‌ேদ வদதாং வரம் ||

(In the absence of e-Grantamil font, the above text will be rendered as a admixture of Tamil & Bengali)