Hi Ray...You are a genius ..This is what i want to do...I thought it is not possible with Mach3 because of my ignorance to the knowledge of encoders... I was thinking to control the X/Y carriage with Mach3 and the spindle i.e. Motor with Arduino Microcontroller...
But now i dropped my idea to control the spindle with Arduino,its a bit complicated..Now i want to control the whole system with Mach3 alone..
Ray CAN YOu help me in this HOW CAN I DO IT IN MACH3..Kindly give me some step by step method/Hints so that i can do this..PleaseFollowing is my thread on Arduino Forum
http://www.arduino.cc/cgi-bin/yabb2/YaBB.pl?num=1260432183/0#3But i was stuck into that problem and my mind is not working

I am at the totally dead point and YOU came in the form of LIGHT RAY..thanks
I was also thinking on the same and i made some pseudocode for Arduino

Consider we have two potentiometer at both carriage X and Y.
consider both Pots divided into 0~5V ( corresponding PWM 0~255) we can map..
To get the value of Hyp. of triangle the pseudocode..
//Initialization of variables
hyp=0
Old_PWM_A=0
New_PWM_A=0
Old_PWM_B=0
New_PWM_B=0
Constant_RPM_Wheel= 5 //lets suppose this is initial rough value
//This value will later fine tuned, but for the time now consider the //sewing machine Paddle is pressed at this when 'hyp=0' or there is //no movement in carriage.
/* When the Machine carriage will start movement (manual or Computer controlled) we will convert the Previous New_PWM values into Old_PWM values */
New_PWM_A= Some value we will get when Pot. change value
Old_PWM_A= previously stored New_PWM_value at A
New_PWM_B=Some value we will get when Pot. change value
Old_PWM_B= previously stored New_PWM_value at B
Now calculating the value of 'hyp' variable and put some DELAY
hyp= SQRT(Sqr(New_PWM_A-Old_PWM_A)+sqr(New_PWM_B-Old_PWM_B))
This hyp value will be scaled or Mapped
If this hyp!=0 then we can run another DC motor that will press the paddle foot with simple mechanism.
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