Thanks to Tesla Orchestra's John Kasunich (who is a sometime EMC2 dev), we managed to get a stepper motor to move a bit! Part of the problem was that we were using the wrong hardware address for the parallel port card(should be 0xecf8- oops!). The rest was the odd quadrature encoding stuff.
If you're around and want to look at it, the file with what we did can be found on the CNC computer in ~/emc2/configs/StartingToWork. There's only a .hal file in there now. John suggested using stepconf to get a partial configuration going, and then merging in the changes from what we did and tweaking from there.
I also tried the Taig collet nut and that did in fact fit the spindle, so we have a little tooling once we get motion completely working!
Now, what should we do with the Chinese 4-axis controller I ordered? I'm open to suggestions...