Just to cut in; in my experience with several Machine Tools, I've never seen a "Stop" button, it is always "Feedhold". Haas, Doosan, Mazak, other Fanuc controlled machines all have feedholds. It is Feedhold then reset. Feedhold is a controlled stop of (as far as I can tell) the motion planner. The ESS has (or did have) a "Controlled Stop" option in the setup. If you want to check that box, it will make the stop button a controlled stop.
Your feedhold is what you need to press when you need to stop the machine for minor issues, E Stop is the last resort for major issues due to the abruptness of the stop is should cause.
In regards to the E Stop; we wire our estop's into an e stop relay that in turn cuts power to the contactors controlling our servo or stepper drives, our spindle, and our coolant (just in case); the relay also has a NC circuit that we wire back to the motion controller so we can use the e stop signal inside Mach4 to let it do it's thing on the software side.
In the past we have had serious issues with, as you call it, a backwash of surges and faults due to bad wiring on our part.
Rufustoad, I think you have some more underlying issues going on if you hit estop and you lose your inputs. Also, if you part slipped, you need to re-establish your part's work zero before you can just rehome and continue machining. If you shut down Mach4 properly you do not lose any of your offsets that you have made, you only lose offsets when Mach4 crashes unexpectedly.