I mounted my DRO to the carriage on a vertical stalk retaining the swing arm any excess cable is tied to the vertical stalk nothing dragging in the chip pan or pulling on the read heads every thing is fixed to the carriage I also mounted the cross slide scale to the front because of the tail stock
you might want to check out Stefan Gotteswinter where he modified a wohlhaupter mt4 shank to 32 mm to be held in collet do not know whether your shank is solid or hollow