Hi guys,
New member here so take what I say with a grain of salt. But I am a machinist by trade. Ok first off the talk of accuracies. ANY machine is only as accurate as the operator. I learned manual machining on bridgeports and other units older than my grandfather with more slop(backlash) than, well more than you can imagine. And the tolerances we were required to hold for the parts to "pass" were .001. But as long as the gibs hold everything where it should be then backlash is something to just account for.
Tooling, harbor freight has a set of indexable carbide cutters for like 35 bucks and extra inserts are available from amazon. I have found them to be invaluable. Yes learn to grind your own cutter as micro boring bars are crazy expensive for what they are. The quick change toolpost will pay for itself in time saving and in tooling savings, as you can then use almost any surplus tooling you can find, and when you have 15 years of misc tooling piled around, that can be allot.
This little 7x12 is a decent machine, as others have stated the tailstock kinda sucks gonads for many different reasons, but with the right adapters and ingenuity with the quick change post you can eliminate it for most any operation needing it.
comparing it to other machine, the biggest thing is to look at the weight, or mass, of the unit. Mass absorbs vibrations and a more massive machine will be a godsend when wanting nice cuts while making a heavy cut. Remember there is a limit to how small of a cut should be made. It has to do with tool edge and at some point you are not cutting but burnishing.
I also have a 8x12-14 lathe that I will start working on converting to cnc again soon, and I loved it, much more than this 7x12. Mainly due to the sheer size and mass of the machine, 250-300 lbs of metal there.
Another great add-on is a 5c collet chuck, a wee bit spendy but if you are doing a lot of smaller parts it will be invaluable.

ok enough for now I think, hope I could help.

http://youtu.be/CmkY8H791C0 There are a couple other videos for this lathe as well.