I don't see why you couldn't thread mill using C and Z for lead and X for diameter. That's how CNC thread milling machines work. At least that's how the one we built does.LOL
Check with Ph Horn for indexable thread milling cutters
add: On our thread milling machine, the cutter axis is on centerline of Z axis but the cutter must be swiveled (tilted) to match the lead angle of the thread. If not, the thread form will not be correct.