As best as I understand from what Tommy at IHCNC is telling me. You can buy them with a ten pin out or a 5 pin out. The five pin out basically snaps right over the existing encoder pins (it has five pins) and then you plug the original 5 wire connector for the cable into it. so you basically have the same connections at the driver end as you originally had. He says he does it on all his machines.
If you look on the Gecko site, They want you to "Solder a 1uF 25V capacitor between the +5V and GND pins on the encoder body" to use this style of encoder in the first place. This basically performs that task as well as acting as a line driver. It may be that is the only real function in this installation, but if it helps quiet things down and fixes my issue I am game to try it since his machines work and mine currently does not.
I am afraid I am not savvy enough with electronics at the moment, so I feel a bit over my head here trying to fix this. I talked to Steve over at PMDX for a while too, He had a lot of good info for me and things I could try as well. Like putting an EMI filter on my VFD and Grounding the negative lead on my power supply to prevent a ground loop from occurring. going to tinker with all of that to see if any of it does some good.