Well, I have tried again, but still have a run-out.
This time, I managed to hold the blank for the back-plate in the three jaw chuck, face it off, drill, bore and tap the thread and then cut the register all in one setting on the Flexispeed. I then span it on to the spindle the correct way around and faced it off.
Using a DTI, I then checked the turned face for run-out. Immediately after facing it, I had zero run-out on the face at the edge (it is about 70mm in diameter. However, when I removed it and replaced it, I measured approximately 2.5 thou run-out at the periphery of the disc.
I do know why I cannot get a zero run-out: perhaps I am expecting too much. However, I shall persevere to see how truly a 1/8" milling cutter runs when the holder is finished.
James.