The G540 VFD output does not really 'output' anything on its own. It takes a voltage source you provide and gives you back a signal that is proportional to the current speed being asked for. For if you apply 10V to the VFD 'input' terminals and ask for a spindle speed that is 1/2 of the maximum range (i.e. the PWM will be at 50% duty cycle), you will get 5V out on the VFD 'output' pin (50% of the voltage you input.) If your input voltage is 5V then you will get back 50% of that.
There are two separate issues here. One is that the STDR-4C has an internal relay that controls the 'Spindle' outlet. When Mach3 says to turn the spindle on this relay is triggered and you have 120V AC on the spindle outlet. In the profile Paul posted there were a few things amiss, the spindle relay active low state was backwards and the pulley range(s) may not have been correct for his machine. I corrected this and sent him a copy.
Paul, let's divide this problem in half. First thing to check is to copy the XML I sent into your Mach3 directory and start up Mach with it. When you hit F5 (or type M3 in the MDI line) you should hear a click, that will be the spindle relay turning on. Pres F5 again and the relay will turn off. If that happens we know the spindle relay is fine. Now get a voltmeter set to measure 120VAC, press F5 to turn on the spindle relay and measure the output of the 'Spindle' connector on the back panel of the STDR-4C. Do you have 120VAC present? Press F5 to turn the relay off, did the 120VAC go away?
One we know that part of things are working we'll leave those settings alone and move on to the VFD output.