Mike - From you opening line, you say you are new to CNC. You have your machine now converted for CNC use. You are ready to go.
The first question in CNC is WHERE FROM. You must start with your tool at a set position (x,y,z) so that Mach 3 knows where it is starting. It is normal on a miller to have x0,y0 at the bottom left hand corner of the table, and z0 can be any where - but is normally on the top surface of the workpiece.
Your first task, is, therefore, to jog your table to that position, set the tool at that height then click the "Ref All Home" and all the machine DROs will go to zero.(Assuming that you have not connected any homing switches to your machine).
The next problem is your code. Quite clearly your code must start and assume the cutter is at the bottom left hand corner of the workpiece and the tool is resting on the work piece.
If you ignore all the **** at the beginning of a G Code program ( they are there to usually cancel everything that might have been left on from a previous program) (THEY CAN BE DELETED - THE PROGRAM WILL STILL RUN) - the first command you are looking for is a move from your start position to where the tool will start to engrave. In your case it should be ( engraving on a 1" bar ) something like:
g0 z0.250 (move the cutter up out of the way), g0 x0.5 y0.7 (move the cutter to the start position for the first letter), m3 (start the spindle), g1 z-0.05 (bring spindle down to cut into workpiece by 0.05) - there will then follow a series of g1 moves as the first letter is cut. At the end of each letter, you should be able to spot the g0 z0.250 command which lifts the tool clear of the work before moving to the next letter.
This quite clearly leads us to ask - what are you using to generate your code.
The program you are using must able to identify the bottom left hand corber of the table as x0,y0. and write all the other code accordingly. You must make sure all offsets are cleared or cancelled.
Start simply - and engrave your name - but generate the code one letter at a time first. When you have entered the code in Mach 3 go to the editor and read it, and try and spread it out into easily defined pieces - like - preamble, opening move, first cut, next move, 2nd cut, next move etc.
If you picture your cutter on the table, you should be able to understand where it should be at any time on a cut. Mach 3 as you step through it (without the miller being on) will highlight the cut being taken and you should be able to understand the x and y positions.
Now I don't know if this diatribe is going to help you or not.
As for the G00 x0.21375 y0.4998 - erase it, and see what happens.
Check in the tool table and see that tool "0" does not have an entry.
I don't know what feed rate or RPM you want to put in (I don't do a lot of Ali)
Rapid tool height is the tool height at which it is clear to move the x,y axis in a rapid movement - I used 0.250 in my example
Z top will probably be how high can the Z axis go
Depth will be depth of cut
Have another go - print out the G code and see if you can read it - you will be suprised, it is fairly simple. all it is is a move from whereever the axis is to a new set of co-ordinates, either rapid (G0) or cutting speed (G1)