Don,

Sounds like the rectangular bar might be intended to mount the indicator in
a lantern type lathe toolpost. I can't think how it might be useful for
mounting to a mill spindle.

I wish you guys would stop saying "lathe" - my evil twin reads this
group, and he buys all of the tools

That likely explains it. One option would be to improvise an adaptor
with a slot and set screw for the bar, and post to go into the spindle.
Of course, it would be easier to build that if I had a lathe - damn,
now you have me saying it

On that forbidden subject, I am stalling in large part because I don't
have any idea what size machine to get. I _think_ a Sherline would do
everything I would want, but every so often, somebody suggests something
that sounds like it would be good to be able to do, and that might not
fit on such a small machine.

Thanks!

Bill