Toolsetter inaccuracy with Redline

I have started creating carves with multiple tools, and relying on the Toolsetter. It has been working well, and I hope to install my ATC soon. But I ran into an issue today that concerns me. My carve included a toolpath that included text carved 0.5mm deep using a 1/16" bit (after carving with a 1/8" bit). My 1/16" tool touched off and proceeded to carve above the material. This means it got the Z offset wrong by at least 0.5mm.

Not everything I carve needs this level of accuracy in the Z axis - but some of it does. I am now concerned that I can’t rely on the toolsetter. I was really hoping to perform carves with multiple tools when I got my ATC installed. But it relies on the toolsetting to ensure the Z.

Has anyone else run into this?

Indeed I did. Take a look at this thread.

Also, double-check to make sure that every tool has a unique ID in your CAD tool list, and that it matches the tool ID in the HMI tool list.