Newbie Questions

I'm pretty new to machining, so please forgive me if my questions have
already been re-hashed ad nauseam. I have a Rong Fu Geared Head
Mill/Drill from Enco. So far I've only made one part!

http://www.smidgie/928/machineshop (nothing about machining until the
very end)

At any rate, I've discovered that I really can't stand using the dials
and I want to reduce the backlash of the machine. I've also started
working on converting the machine to CNC. So, here's my questions:

1) I have roughly .015" backlash in my X and Y travels. I've heard talk
about "double-nutting" in order to reduce backlash. Has anyone done this
to one of the little Mill/Drills? Any advice on how to go about doing it?
I've considered going to ball screws but my understanding is that ball
screws make it so that the machine can not be used for manual milling -
is that correct?

2) Judging by others' comments, it appears that one of the biggest
disadvantages to the little Mill/Drills is that you lose your position
when you move the head up and down. Has anyone done anything to address
this?

3) I don't expect to have the machine converted to CNC anytime in the
near future, in the meantime I'd really like a DRO for at least the X and
Y axis.

The least expensive method (once you factor in the cost of the
PC/Monitor..etc) and the quickest to get setup seems to be to use
digimatic scales (the ones that are kind of like digital calipers without
the caliper part) with SPC output to an external 3-axis readout. WTtool
sells the readout for $249 and the individual scales are available for
roughly $200 for three, so call it $500 once I make the
brackets/shipping..etc. The disadvantage to this is, as far as I know, I
can't get the SPC outputs into a PC.

I'm planning on using servo motors (already have two) with Gecko drives
for my CNC upgrade. The servo motors have encoders attached so in a sense
the external DRO would be redundant. So, I *could* get the X/Y motors
hooked up (which has a lot of other advantages, but will be very
expensive because all of a suddenly I will have my credit card out and
will be calling Gecko for drives, and getting a power supply
and...and..and..) and use the encoders on the motors with one of the free
DRO software utilities. One disadvantage to this is the servo encoders
will have to compensate for backlash which may or may not be a problem. I
assume it isn't a huge problem because it appears to be common practice.

The other method would be to build my own rotary-to-linear encoder system
which certainly has appeal and could have better resolution than either
of the two previous methods. However I don't know that it is necessary...

So, bottom line, is there an advantage to having two DRO systems on a
single mill? If I put on a digimatic scale system will I end up junking
it once I get my CNC stuff completed?

Thanks!

--C.S.