If the code is in Dia mode, ie it is correct dimension in code then sounds like Mach is in Rad mode, check to see by going to MDI and commanding a X move.
Call a G50 from MDI just in case there are any scales active, G50 will reset to 1.
If it is still wrong then as I mentioned previously 066 has issues, especially with lathes. one is that wear offsets on X are in Rad no matter whether you are in Dia mode, so maybe it is also acting on normal X values as well.
Part in chuck was three parts, basically a part with a hole, a delrin sleeve and then the inserted part, so delrin is insulating the part in the chuck from the part the tool is touching.
Hood