The touch pad sometimes IS just a piece of aluminum with a wire attached. But there is a lot more to it than that.
First, the wire you're talking about has to be wired to an unused input on either the daughtercard connector or on the PCI card connector.
Next, the input has to be set up in the wincnc.ini file as a low limit on your vertical axis (I assume it is Z).
Next, you have to have a macro that will lower the tool until it touches the pad then sets a local zero for that axis.
Oh yeah, there is one more important thing I forgot to mention. The only way this thing stops when it make contact with the pad is if there is a connection between the ground for the inputs and the tip of your tool. That means the tip of your tool is ground for the input you have wired to your pad. IF it is right, it will complete the loop between the input and its ground. Otherwise you've just crashed your tool.
Sorry I can't be more elaborate. You would probably be better off contacting your machine manufacturer and asking them of they can provide you with a pad and set it up for you.