I don't cut anything thicker than .75 cherry blanks but we had some of the same issues.
We found that 1 or 2 sides would excessively chip because the bit was travelling in the wrong direction for its rotation. Instead of cutting into the wood it was running backwards against the stock on the 2 sides as well as cross grain.
Try reversing the cut direction for the 2 sides to make sure the bit always travels in the correct direction. We also get better results with a 2 flutes instead of 4 flute bit at lower speeds.
Now we tape both top and bottom of the blank and back all cutouts / cutoffs with wood like CNCadmin suggested. We also cut all blanks .0625 thick in multi pass and then take off the final bit in 1 pass at slow speed.
We didnt solve these issues until we asked a very talented woodworker to come in and look at the settup. If none of the above helps maybe you should ask the opinion of a few local craftsmen. They are usually fascinated with the process.
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