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You just need to work through everything one step at a time.
Is the index pulse being fed back reliably?
You mention you have the RPM displayed, but is it accurate. Unless you're running closed loop, it should always be off from the requested RPM by at least a few RPM. From what I remember, Mach will show the commanded speed by default, not the actual speed.
Also, is the index LED going on and off on the diagnostic page when you move the spindle slot back and forth through whatever sensor you're using?

Are your axis tuned to accelerate/decelerate fast enough?
If they're set too slow, Mach will calculate they can't move fast enough, and just hang at any threads. Try running the spindle as slow as possible, and air cut a very small pitch thread. If it works, then check your motor tuning. Lathes will appear to run very well with low acceleration, it's only when you try threading that the poor acceleration will show.


If none of that shows a problem, then post on the machsupport forum. There are guys on there who know far better about potential problems than on here.[/QUOTE]

The STrue is always slightly out unless I run it in closed loop spindle control mode.
I tried running the threading program at 200 rpm but again it wouldn't actually start threading.
On the Diagnostics info screen the "missing index pulse detected" remains unchecked so I think there is no problem with that.
However I just noticed that the "rotation speed real-time" is about 180000rpm
Whilst the "application end rpm" is 598ish.
Would this be a problem?
I've attached a photo of this screen in my original post.