The Styrofoam packing is not firm enough to handle the weight of cast iron assemblies. It will crumble like this during normal shock loads during shipping. I have gotten things like a 22" scroll saw from Grizzly that looked like this, and had two broken castings. There were no holes in the box when I signed for the delivery.

The bent bolt can be straightened easily enough. It looks like a T-slot bolt that is used on some mill table clamp sets.

The grease is normal for Chinese mill equipment. The workers handle a lot of greasy equipment each day and don't spend the time to clean up the equipment before packing.

The gears will look worn even when new. My buddy bought one of the HF mini-mills five or so years ago. I made the belt drive parts for him from plans he found on the web after he had a series of shattered gears. I looked at the broken gear pieces and they are cast, not machined from solid stock. The plastic had air bubbles in it and was fairly brittle, unlike higher quality machined nylon gears would look. There are replacement metal gears available, possibly from LMS, because of this problem. Mini-mill forums folks will know where to find them.

The way to check run-out is with a magnetic dial indicator base stuck to the side of the casting and a dial indicator mounted into the base. Install a collet with an end mill in the collet. Position the dial indicator tip on the shank of the end mill then rotate the end mill by hand and watch the indicator variations. If you see significant run-out, remove the collet, clean the collet and inside of the spindle, and try it again. You'll be lucky if you see 0.0015" to 0.003" run-out. Less is better though. You may feel significant backlash in the gears though, and that is normal.

I also recommend calling or emailing LMS about this before doing anything like trying to repair it yourself. I don't think that anything internal got damaged during shipment due to the Styrofoam packing. We'll never know if this particular unit was returned from a previous LMS customer or not.

CarveOne