When you have different hardware like this working together the outcome in unpredictable. The first thing I would do is revert back to Mach .062. Version .066 has a whole bunch of bugs that many folks have noticed.
Depending on how the pendant implemented jogging it may or may not work properly. Some pendants simulate keyboard presses which usually works OK will only work if your screen set is configured properly. If the pendant uses its own plug-in then they way it does things may not work properly with external motion controllers. Best to ask your pendant vendor about that.
When you reinstall Mach make sure only the plug-ins you are using are in the plug-ins folder. Sometimes it help to install the pendant plug in, get it running as though in parallel port mode, then install the plug-in for the motion board (SmoothStepper) this makes sure Mach calls the pendant plug-in first.
You should post this on the Warp9 forum. Greg wrote a special plug-in to record the jog commands that Mach3 sent to the plug-ins so he could diagnose a jogging issue a few weeks ago. Take a look at this thread:
http://www.warp9td.com/index.php/kunena/7-general-discussion/4843-runaway-axis-returning-from-hit-limit-switch?start=6 The GCode edit problem is unrelated to using the SmoothStepper. I use it all the time with the SmoothStepper and non SmoothStepper equipped machines.