Lathe support is pretty new to emc2.. What version emc2 are you using?
We don't know how much is in the 2.0 release.
There is a lot of support in head though.
Take a look at the nist config
http://cvs.linuxcnc.org/cvs/emc2/configs/nist-lathe/
to install head
http://wiki.linuxcnc.org/cgi-bin/emcinfo.pl/emcinfo.pl?Installing_EMC2
look at secion 2 (this is for ubuntu)
Now head is constantly being updated - so there might be issues off and on.
here is what they have added and hope to add
http://wiki.linuxcnc.org/cgi-bin/emcinfo.pl/emcinfo.pl?Lathe_Advanced_Features
here is a picture of emc2-axis lathe setup
[img]http://wiki.linuxcnc.org/uploads/axis-lathe-mm.png[/img]
I have not used the lathe setup yet - this is all from asking the experts at on the irc.freenode.net #emc channel. They are very very good.
sam