Couple updates: (Sry we are off subject of HSD spindles)
Since I may have said it wrong, on the Z mount there are 8 bearings and 4 v-guides. There is a "groove" wore into 3 of the 4 guides at 6 of the 8 bearing locations.
That being said, I did go ahead and use the spacer and try again. Only helped a little bit, but running at .0125" chip load the Spindle still tries to jump clean off the CNC. at .0097" Chip load, it runs much better but, the cutter is squealing and the saw dust is pretty warm. (trying to stop cooking bearings on spindles, kind of a bad habbit) Once I switched over and ran some Advantec instead of plywood then I could run it at .011 without much problem. If I didn't mention all of this is from running 3/4 plywood and 3/4 Advantec.
I'm beginning to wonder if maybe I need a full overhaul and go through everything with a fine tooth comb I truly hope not just for the simple fact, I already run 7 days a week. Not sure catching up from a rebuild is something my body is going to be able to handle.