Funny you should mention that! ……
I was running the Mk VII lathe this afternoon and at first the quill kept backing off and releasing the spur. I added a washer borrowed from my 510 and it worked fine. I suspect flipping the cup washer would make it lock without the washer (the 510 does) but I should be looking for that washer anyway.
Drill press and lathe operations both indicated the need for a quill bearing replacement. A 2 1/2” Forstner bit will show you runoff if you have it! I also noticed that the spindle I was turning chattered at the headstock end so I think it is conclusive.
All that said, I have a functioning (80%) Mark VII for so far $100 +$50 for paint.
