Gremlin117 said:
Ok, I've been around this block once, or twice.... or three times...
First things first, he said he has a neighbor that works on a CNC machine. I assume that means he won't be building/owning one, and in fact he may never even see the machine himself if his buddy does all the work. But since we've started talking about DIY machines, I'll elaborate...
Gremlin, you've definitely done your homework, and hopefully you'll get yours [built] soon. You'll love it, and it's not nearly as bad as you fear. These MDF-structure CNC routers are great, and pretty easy to build. I really recommend that you check out
http://www.buildyourcnc.com because the routers there are, in my opinion, better than any other similar machines around, including the Fireball V90. The BuildYourCNC ones also use a real wood router, not a Dremel, so they are far more powerful and can even cut aluminum.
You're absolutely correct that $1000-$1500 is a more appropriate figure for the bottom line. The price that the Instructibles article claims is the product of "creative accounting"; it leaves out the hidden costs of a lot of things (tax, tools, shipping, bits/accessories), goes to some ridiculous lengths to save money, uses only free/trial software (that you will probably want to replace with $200-700 worth of commercial stuff), and still comes out to over
$550 without counting the $100 Dremel/router or computer. A lot of the people that build these things are tinkerers by nature, like myself, and have lots of these "extras" around the house already, so they forget to include them in their appraisals.
Depending what material you are cutting, even these DIY CNC routers can be very fast. In foam, mine (built from
http://www.buildyourcnc.com) can cut at maximum speed because the foam will never bog down the bit. You can adjust the speed faster by reducing the resolution of the stepper motors. Before you panic, this resolution reduction is in "machinishland", so it only actually amounts to a reduction of a couple thousandths of an inch of accuracy, which is perfectly acceptable for carving costume pieces. Nobody is going to notice that the notch in your chestplate is 0.005" off center.

You can sand the foam smooth quickly to finish it.
You are absolutely correct that the router is loud. They also produce a lot of dust. You'll only want it in your garage, realistically. The ones that use a Dremel are probably considerably quieter, and you might be able to get away with running in your basement, in some kind of construction "tent" to contain the dust.
The 3" z-axis isn't a problem, especially if you're building it yourself. You just build it taller! (Granted, that takes some re-engineering.) Most of them are only a couple inches high because most of the people are using them in 2D to cut out flat parts from board/MDF. The machines are capable of supporting larger z-axis travel, software-wise/etc. The biggest concern is that if you give it too much travel, you run the risk of the bit trying to cut a deep enough point that the collet/tool runs into the material. This is a problem with full-size commercial CNC as well.
ennder said:
G code is used mainly for 2D CNC machines
No, G-code is just a tool movement language. You can actually open it and read it with Notepad. It just tells the machine what to do, like driving directions,... "Go to position 0,0,0. Set movement speed to 2 in/sec. Move to position 0,1,0. Plunge the bit down 1" by moving to position 0,1,-1." Even 2D mahines are really 3D machines, so you're probably really talking about 3-axis vs. 5-axis machines, both of which still use g-code.
It doesn't matter what format your original file is in (all the ones you mentioned are viable), it will have to be converted into g-code instructions (or some other proprietary language) to tell the machine the movements needed to actually cut out the part. The machine has no idea what it's making, only the movements it's supposed to follow, the same way that I can give you directions to somewhere and you don't know where you're going. This g-code is pretty industry-standard, and you can load it into almost any CNC controller.
The CNC controller is a device/software that talks 2 languages: g-code and the digital language of the actual machine. It takes the g-code instructions, converts them to digital pulses, and sends them to the machine's motors.