That's an X2 mill I think. 2mm DOC sounds a bit aggressive for that machine? How fast were you feeding?
Do you have a magnifying glass? Look at the tool edges in a good light – you'll see if they have been damaged.
You say you checked with a file so the steel doesn't sound hardened but I guess it might have a bad patch.
This machine doesn't have table stops so it can't be that.
How were you holding the cutter? Jacobs chuck or collet?
How were you holding the work? A quick alternative to proper tee nuts is a bit of MS bar that just fits in the base of the slot and can slide along, with a tapped hole. Most tee nuts have a hole right through but often the bottom end is burred over to prevent the stud bottoming against the base of the slot – do the same on this quick alternative for the same reason. But proper tee nuts are better.
What do you mean by a "sloppy" workpiece?
If the cutter is blunt then you'll have to try another one. Hold it in a collet. Try 0.5mm DOC, don't be shy with the feed but not silly either – you should be able to tell if it's happy, it will make a sort of "chuffing" sound.