Andy,
Welcome to the forum.
I have not had any problem putting 10 mm tools in my Dickson holders on my S7. However, it is fair to say that the margin before the toolholder bottoms out is a hair's breadth in some cases.
Some thoughts which may (or may not!) help:
(1) First – and forgive me if this insults your intelligence, but you did say you were a beginner…. I assume from your question that you know how to adjust the tool height by moving the clamping nut on the holders, but have you checked that there is no trace of swarf at the base of the toolpost which stops the holder bedding down as far as it will go? I have had this happen to me before now.
(2) There can be some slight (fractions of a mm) variation in centre height between different examples of the same lathe. Measure yours, and also the height above the cross-slide and top-slide, you will find these are very useful reference figures to have noted down anyway (write them down on or in the instruction book if you have one). I'm not aware that there is any difference in the height over topslide between ML7 and S7, but I supppose it is possible.
(3) There is also a slight variation in the thickness of the bottom part of the Dickson holders I have from various sources, maybe 1/4 – 1/2 mm. Examine yours and see if some of them work.
(4) There is no reason why you should not take half a mm off the bottom of the tool shank; the indexable holders are AFAIK made of reasonably-machinable steel.
David
PS – One final gentle suggestion – it may be better, when you have a new question, to start a new thread rather than append your question to one which petered out 5 months ago. Makes it easier for people to see what you are asking about, for one thing; not everybody reads every thread.
Edited By David Littlewood on 16/08/2012 11:39:48