john,
Please read 10.7.17 in the mill manual about the G53 command.
Machine Coordinates are absolute coordinates from some 0,0,0 defined datum point.
The defined datum point of 0,0,0 is where some physical point ( controlled point would be a better word) is on the machine. Mach is the controlling software and has an internal 0,0,0 point to work from. Until the machine is referenced it does not know / can't relate the software 0,0,0 to some defined physical location of 0,0,0. Only you can say where the physical point is. So the controller provides a way to do that since it can't hear, see, what ever, and provides for using switches to electronically and automatically relate the software 0,0,0 to the physical 0,0,0. When that is done it can keep track of the axis coordinates for the current session.
RICH