I want to machine a round to be an interference fit in that bearing, so perhaps finished diameter of 0.5005"
First, recognize that tenths are not easy to do on a lathe. I second what others have said here. But perhaps I can add a few other techniques.
I've found that sharp carbide inserts for Aluminium work quite well at removing small increments of steel. However, you will be more successful if you let the tool teach you what it likes by measuring, adjust, cut, and then measure again, so you can calculate the result. And realize that this method is not linear.
You are better off using the half's method to zero in on what you want. The half's method is not for the faint of heart. You have to learn to trust yourself and practicing is a good way to do that.
A very sharp shearing tool can do wonders for taking very fine cuts with a great finish.
You don't have to have a proper burnishing tool to do burnishing at such small increment levels.
Like
@OliverTO says, you can use the compound to take very fine cuts with a very sharp hss tool. 5.74 degrees is 10:1. (1 thou = 1 tenth). But I just use 6 cuz it's close enough. But very fine cuts require a VERY sharp tool and lots of patience.
When I do overshoot the target, I've used gap loktite like
@Mcgyver suggested very successfully.
I've also successfully used 800 grit sandpaper for sheet metal with oil to polish off an extra tenth. You just have to ignore the look and feel and be careful to be uniform with the pressure and overlap or you will not end up with a uniform diameter. It's best to do it all at once - not back and forth.
A good fine grit hone can be used on inside surfaces.