First thing, is that for engraving or general 2-1/2D milling, which I'm pretty sure is what you're talking about, Millwizard is the wrong choice. A much better choice would be SheetCAM. http://www.sheetcam.com Although after re-reading your post, engraving the surface of rings may be a bit tricky. But Millwizrd is not the software to use for engraving.
Millwizard will run just fine in XP.
How to export .stl?
After the drawing is done in Rhino, just choose "Save As" and choose the correct file type, .stl for Millwizard, or .dxf for SheetCAM. Once saved, you just use the "Open command to load the file into the CAM program of your choice. You can set the mesh size in Rhino when saving.
Millwizard creates the toolpaths, and saves them as a g-code file.
Millwizard can simulate the tool path and show what the finish part will look like.
Millwizard can NOT control a machine. I'd recommend Mach2 (soon Mach3) from http://www.artofcnc.ca You load the g-code file from Millwizard into Mach2, and Mach2 will send step and direction signals to your motor drives.
This can be done in Mach2, and might be somewhat dependant on the part location in Rhino relative to the origin in Rhino.Does ArtCAM MillWizard CAM provide for the specification and positioning of the 0,0,0 relationship between the starting position of the part and tool?
No software can provide isolation protection. It would have to be done by the hardware, and depends on what hardware you'll be using.
I really don't know if that package is right for your machine.
As I said, I don't believe Millwizard to be the right software for you. If you think it is, I would recommend an alternative. MeshCAM, at http://www.grzsoftware.com basically does the same thing as Millwizard, for less money, with more features. The only thing it lacks is the simulation.