Regarding the converter to change from single ended encoder to differential, the "Line Driver Module" sold by CNC4PC will do the job. It is the DG6 module, which takes input A,B,Z, 5v, GND from the encoder, and outputs A+, A-, B+, B-, Z+, Z- 5v, GND through a RJ45 connector. The J6 board, and the J7 have connections for A+, A- ....etc., for each axis. The A-, B-, Z- signals are not regular ground connections. Do not connect them to ground.
Make sure to do a continuity check from each terminal on the J6, or J7 board back to the RJ45 connector which plugs into the module. It is easy to mix up the wires. I used a RJ45 female connector with numbered screw terminals, which you can plug the RJ45 plug into. You have to splice the original encoder wires onto short Cat5 connector cable+end to make up the connection to the DG6 module. The module is less than $10.00, and has a web site to get all the wire date info.
Pay attention to the "Encoder Polarity" check box on the dspmc set-up page. You can specify Positive, or Negative in a drop down box. One way the motor will not work, one way it will. I had a frustrating time trying to get the machine working, until I fiinally tried that check box.
If your encoder wiring does not have the necessary (8)wires with shielding, you will have to change it over.
Do one axis at a time, and get it working before doing a second.
Hope this helps.