You can easily get accuracy of much less than a mm. I would suggest a cnc'ed Taig mill as a good option. It is reasonably priced and, with a well selected controller/motor package, can be up and running in a couple of hours. The travels are roughly 12x6x6 so it falls a bit short in the Y direction. However you can probably work around that quite easily.
You want to buy one with a Gecko G540 based controller. A couple of dealers who offer those are;
http://www.deepgroove1.com/cncmill.htm
and
soigeneris (you will have to google them)
I bought from deepgroove1 before the G540 came out and have since upgraded to the Gecko. I have ordered parts and accessories from Soigneris and have been pleased with the service. I think Soigeneris' controller is a bit nicer but you pay a bit more.
bob


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. 0.2 pitch lead screws are available at the same price and allow for twice the speed while maintaining precision with microstepping controllers. Make sure you get the couplers, cable rails, zero switches, router support, router (I like the
