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In making my Quorn I bored the spindle housing in the mill as it is an odd shape and was much easier to setup in the mill - as I approached the final size I realised that the bored hole was beginning to become tapered I was at a loss to know why but suspect that as the spindle housing was quite long (over 4inches) the quill was flexing once it was a few inches out of the mill head. The hole ended up oversize by approx 80 thou and was still tapered, I ended up setting it up in the lathe and successfully bored the taper out of it, fortunately I had not yet made the spindle so I could compensate by making the spindle OD slightly oversize to match.
With regard to the tapping compund, I have some stuff that I can only describe as brown goop, it was mixed up by a local guy and sold through a small hardware store that has long closed due to stiff competition from our large chain hardware group Bunnings. I suspect that the basis of the compound is lard with some sort of mineral oil added to keep it soft enough to be used from sauce type squeeze bottle.
At four inches, I would have thought that the boring bar would be flexing causing the taper. I've had a similar experience where the hole got smaller as it got deeper. 8 mm diameter boring bar, in my case, boring bars are not particularly rigid.