Ah ok, the pull out, yes that is a problem with the CSMIO or rather Mach and the way it communicates with the plugin. If an external device is using full encoder to sync the Z to spindle then Mach has a delay in updating the plugin with information,
The Galil also suffered with this problem when they used encoder to sync Z so they reverted to single index pulse method.
I found an older version of Mach made the pullout almost instantaneous, if I recall it was 022. The spindle override did not work in that version however and I did not test it for long to see if there were any other issues but it may be worth you giving it a try.
I have been assured that there will not be a problem in Mach4 but when that will be available I have no idea, could be 2 months, could be 2 years
Hood