Wayne -
OK, I'm just speculating ... but the specs on the KC-20 state that the spindle is R8. If your larger collets are losing tools, I'd say it was time to buy some better collets.
PS - When tightening the draw bar, is there a way to lock the spindle rotation, so you can tighten things up snugly? If not, you might want to look for or rig up a way to lock the spindle. No need to make it "farmer tight," but pretty snug is good.
Hi Hman
Yes my machine has the R8 spindle too. The collet that was holding my cutter when it slipped was the tormach collet. I don't think the collet is the problem. True, you don't want to overtighten a collet but "a bit tighter" seems to be required and when I try to do that the outer sleeve (the part you put the other wrench on when tightening) loosens off. This sleeve that keeps loosening off is the main reason you can't snug the collet up. At some point I will take it all apart and see what's going on, maybe loctite the thing if possible. I'm sure I can correct it but as I said before I don't often use mills bigger than 1/2" as most of my work is small stuff.
Hbilly
One thing you might want to do is a search on the G0704 and see what all the cnc guys are doing with this machine and the kind of parts they are making. There are home upgrades for power, cnc conversion, it amazing all the things guys are doing. I bought mine because of the possibilities but ALSO because all the work I do is small stuff in brass and aluminum and the machine works well for this. Its not a heavy duty machine, but I like it. The one problem I have with tightening the quill is not a biggie because there are videos (search hoss machine) showing how to take the quill apart etc for upgrading the bearings etc. You can get all kinds of online help with this machine, just not from King. I think grizzly ships to Canada now so you might want to look into that too. Busy Bee sells a version of this machine but the table is miniscule by comparison, I went for the bigger table.