Is there a setting to turn the spindle on without a pulsed output? ... I just want a constant high active signal to pull the spindle relay in with an M03. When I check diagnostics now, I can see the output pulsing...
You are confusing spindle switching (on or off) with spindle speed control. You shouldn't use the speed control to do simple switching.
Config, Ports and Pins, Spindle Set up. Relay control. Untick 'disable spindle relays'. This now means that Output #2 is high for clockwise spindle, Output #1 is high for anti-clockwise spindle. Both are low for spindle off.
You then have to map Output #2 & #1 to a physical parallel port pin in Output Signals tab.