If using an encoder then the pulse width is likely far too short for the parallel port to see correctly.Index pulses from encoders can be used when using most external devices for motion control, devices such as the Smoothstepper, CSMIO/IP-S, DSPMC, Kflop etc.
You can not use one of these devices to just input the index pulse and still use the parallel port for axis control as these devices are used instead of the parallel port.
If you wish to use the parallel port for motion control and use an encoers index pulse then you will likely need to build a circuit that will stretch the index pulse so that it is wide enough for the parallel port to see, you may find info if you search for something like circuit to stretch index pulse.
Hood
Oh and just in case you were thinking me rude, as my last comment sounded harsh when I said "wasting my time" I didnt really mean it in that sense but rather just it is unlikely that anything in your xml will be the problem.