I've tried both HSS and carbide parting-tools, in a rear tool-post, on my ML7.
The HSS seems the more forgiving.
Carbide inserts are made in a baffling array of types and some suit particular metals better than others, but they all have that central groove to fold the chip in on itself, recommended for HSS tools too, I see.
THE big mistake and one I made for years until learning better, is to grind the tool at a pip-breaking angle, because that forces the tool to try to cut a chip wider than the groove.
The tool needs not only be at right-angles to the work (parallel to the chuck face I use to align the tool-holder). It also needs be perpendicular to allow its side clearances to work.
Wherever possible I set the tooling to centre-height by turned pip, which will naturally be on the axis set by the spindle and chuck. Sometimes I use the tailstock centre but that might be optimistic.
"Above" centre-height? (Below for a rear tool-post). Not sure, but I would have thought 10 thou a bit too much.
'
It was Oscar Wilde who opined that:
Sarcasm is the lowest form of wit…
but that is only half of the sentence. It continues,
… but the highest form of intelligence.