Have a Sherline here and have cut threads on it using Sherline's spindle motor, threading accuracy was not good enough for myself ( backlash even with the anti backlash nuts installed), good to about 1/4-20.
You will get spindle slow down but the thread cycle reasonably adjusts for it.
I would not recomend a stepper for the motor as it has no torque at higher rpm's and is rpm limited.
Servo should be fine if adequate.
Threading is built into Mach3 Turn, but, the thread cycle will not work if it is unlicensed / trial version.
RICH