Thanks for the reply.
I did figure the problem out though thanks to this forum.
It turns out that the setup instructions provided with the usbmach board tells you to not assign pins to the mpg and thats the whole problem if you are not using an mpg thats goes thru usb.
What I did was assign pin 10 port 1 to estop, and the mpg i assigned pin 12,13,14 and 15 on port 1 and low and behold it works as intended.
I write here, because have almost the same issue with my new MPG (Handwheel) .
I try to connect it to DDCS Expert, but the behavior is not what should be.
Instead of rising or lowering the values by the choosen axis, the values jumping up/down randomly.
I've measured the outputs A+ B+ A- B- and received really NOT rectangle pulses.