I ended up going with a 10hp and vfd. I found a Baldor motor local, brand new for 250$. Their company stocks spare motors and when they "expire" if they haven't been used they sell them at a discount.

I stripped the machine down and am in the process of putting it back together now. I have a very dumb question to ask. I didn't pay attention to the mounting arrangement of the cable chain when i tore it apart thinking it would be obvious. If someone has a similar lathe and would kindly post a pic I would appreciate it lol.

I tore the electrical cabinet off the machine and plan to mount all the new electronics in the control cabinet on the front of the machine. The original spindle encoder will work with my new electronics so I will retain it for threading. I haven't yet tackled the 8 pos tool changer. I'm saving the best for last. If anyone has any references for retrofitting a 8 pos turret or similar I could use it. Thank you guys for sharing your knowledge.