A 0.001mm dial indicates high sensitivity, not that the instrument performs just as well as a micrometer! I've never used a DTI to measure anything. Am I wrong?
I still have the Mitutoyo 0.001m resolution dial gauge that I used to use for demonstrating to customers that alignments were within spec. on rebuilt machine tools. For its intended use, it was regularly sent out to an independant test establishment & came back with a certificate that detailed the errors thoughout its working envelope (1 mm in this case) – it read within 0.001mm over the full travel with an uncertainty of measurement of +/- 0.001mm, so either dead on or 0.002mm error over 1mm. Having sat in a cabinet in my garage for around 20 years, it is out of calibaration at the moment.
The readings taken with this gauge were used to measure the machine alignments when compared to precision artifacts i.e. large lumps of calibrated granite. So there are instances where a direct measurement is useful. Obviously care had to be taken to ensure that the gauge was set perpendicular to the artifact, but when looking for small errors, care has to be taken period !
I do note that Dave's comment refers to DTI rather than dial gauge, but Neil's comments were WRT plunger clocks. DTIs can be accurate, but IIRC they only read "correctly" when the stylus is in certain positions relative to the body. I have a recollection of a DTI coming with an instruction leaflet that showed the effect that having the stylus set at an angle would have on absolute readings – not an issue if looking to adjust the setting of something to show zero deflection.
Nigel B.