Re the FYSETC display/knob - hard to say, these are used in large numbers of 3D printers, the one thing I've heard is that cable noise is an issue if the cables are extended, and this implies the environment and pullups / drivers can be an issue. They were designed for 5 volt 8 bit systems. I don't like the knob and display being tied together physically so I'm not going to go that route, though I have a couple of them on the shelf. It was just a thought. The 32 bit printer control boards often have a compatible connector for them now, so they are working with 32 bit systems as well, but I haven't looked into how they do the level shifting.
I was looking at my collection of rotary encoders for knobs. I have a quality Grayhill unit that came from an old project, and it has a cable on it rather than pins which would be convenient for the testing. I found it on Digikey, and today it sells for over $50, Wow! Not sure I want to use that one, it is optical and 5 volt so would require level shifting and the cable is 0.050" spacing so not a breadboard drop-in. I have another mechanical type that is designed for heavy duty automotive service, but is PCB pins not in a row so not quite as convenient for a breadboard. There are lots of cheap ones on the net with pins in a single row that are convenient for breadboarding, so perhaps I should get some of those. Probably not terribly good quality, perhaps use for testing and use a better one for the installation on the Lathe.