I use soluble oil on my lathe and mill and like others have said, when the water drains away, an oily film is left, but rust does not seem to be a problem.
Years ago I did use Dromus oil, from Shell, no less, which caused rust all over the place. Got onto Shell about it, still waiting for a reply [it,s only 20 years ago, so no rush ] Changed over to a different product from my local Farm Shop and no problems since.
Regarding rust under vises ect, I use a piece of anti rust paper on the table, which seems to help, but I dont leave anything bolted to the table all the time.
The big problem, as I see it, is that we do not change the contents of the tank often enough [who wants to throw out "good" oil }, so it goes "off" and perhaps does more harm than good. Maybe a smaller tank is the answer ?