ftec,
The reference tool both in mill and lathe have no offsets and I believe is internal to Mach. Don't recall reading or any post specificaly about the philosophy.
Something to always remember is that all tools relate to the master tool and all tools relate to each other!
The reference tool has no diameter and no length so it just represents a point, a controlled point.All other tools
have geometry relative to the controlled point. The offsets vary for each tool and lathe and mill tools are different.
The tool geometry differences are represented the tool table.
G43 is just a command to inform the controller that a tool with a different geometry, as compared to the reference tool,
will be used, and has a different length. Suggest you read up on G40 thru G49.
There is no "real" tool that has a zero radius ( no matter what you do you will never make or buy a pointed tool with no radius at the tip) as it may be small but it is not zero.
RICH