Donn, as soon as I saw the photo you posted, I remember seeing letters much like that when I was first setting up my Shopbot. I was experimenting with different materials I had laying around, and trying the few bits that I had. Now, as this was so long ago, it was my recollection I got a similar effect when I used a big 90 degree V-bit when carving MDF. The bit seemed sharp, and it worked well in my router table to chamfer board edges. But when I had the bit chucked up in my spindle, and would spin the bit by hand at a slow speed, I could see that the tip of that bit was moving eccentrically!
Now, that was a long time ago, and I might be confusing different cases. But after I stopped using that bit with my Shopbot, I don't think I ever saw that problem again.
Good luck, Chuck
Chuck Keysor (circa 1956)
PRT Alpha 60" x 144" (circa 2004)
Columbo 5HP spindle
Aspire 9.0, Rhino 5