Problem- Square milling problem with lathe live tools

[Zeepo]

Hi

We have lathe with fanuc 21i control, it has z,x,y and c-axis.
When moving y-axis also x-axis move same distance, y-axis is 45degrees angle
compared to x-axis. But when moving x-axis y-axis doesn`t move.

So there was little bit details how axis moves.

But here is the problem: When trying to do square shape (or hexagonical) on to cylider shaped part end, with live tools, size differs depending which side i am measuring.
Machine does too big square depending how much feed is programmed.
it also affect how i do it, if do it with one chip (go around the work piece, C-axis brake on) then the error is bigger, i checked the DIFF from servotuning screen and when moving x-axis with feed of F800 DIFF was 2300 counts (8192=360degree on servo), when moving y-axis (x and y interpolating) diff was 1300 counts.

I tried to get rid of the DIFF by increasing the proportional and velocity gain
until the axis started to overhoot. But i didn`t get DIFF smaller.

When i do square just by using x-axis (one cut per side and indexing with C-axis 90degrees) then geometry is ok.

Servo motor is alpha 22/3000.

Has anyone countered similar problems? And if possible how to get rid
of them, maybe do part program differently?