I have had the Grizzly version of your DRO on my mill/drill for fourteen years with issues. Intermittent failures can be difficult to track down. Just when you think you have the problem solved, it pops up again.
I'm assuming that you have a two axis DRO and that the y axis is the cross feed (conventionally called the x axis) and the x axis is the carriage movement (conventionally called the z axis). You stated that you were experiencing problems on both scale but different manifestations. Your x axis was jumping to a new value and your y axis experienced a slight drift. You have swapped the cables already and stated
Some thoughts:
Two or more separate failures usually have a common cause. In my experience, unrelated coincidences are rare.
As far as I am aware, the scales do not output absolute position. They sense magnitude and direction of movement and send pulses to the readout with the counter's position registers located within the readout. The readout does retain the last readings if power is lost and reloads them when power is restored. There is a single point on each scale that is an absolute reference point. It can be utilized using the REF function on your readout.
As to thermal expansion, you really should be looking at expansion coefficients of the glass scale and the aluminum backing that it is bonded to in your analysis. Depending on the type of glass used, the expansion coefficient is between 4 and 6 x 10-6 m/m K. Changes in temperature would cause the scale to bow slightly but, since the scale is fixed at either end, not likely to create a positional change significant enough to cause a meaningful shift in the reading. Similarly for the mounting to the lathe.
In troubleshooting, try to eliminate as many possible causes as you can. I would reconnect the second scale and document the anomalies you are seeing.
Based on what you have said, I would suspect an intermittent electrical problem, a bad connection or bad solder joint. In either case, it would most likely require a return for replace or repair. Assuming that you have two different manifestations on the scales, Record the exact problem with each when it occurs, then swap connections. The problem will either go with the scale or remain which will tell you whether the problem is with the scale or the readout.
Armed with that information, contact the vendor and present your evidence. You should still be under warranty. More than likely, the vendor would replace the entire DRO package.
