Although there is JHChoppers mill thread where he has a stepper that is connected to the spindle for indexing the ATC when i read how he'd done this I thought that would be a great why to run a C axis on a lathe, time will tell.
Personally as its not a massive lathe I would be looking out for an AC servo and drive on eBay. Not sure how the market for these are in the antipodes? Having a servo instead of the induction motor would mean perfect spindle control and no need for pulley ranges as torque is constant from zero to rated speed and there is usually at least double available for short periods.
Only issue at the moment is the SmoothStepper does not support the SwapAxis feature of Mach and dont know if it will but if it happens then rigid tapping and spindle indexing would be a piece of cake.
Hood