OK, I am completely at a loss to explain what was wrong.
I spent all day yesterday trying to get a simple job to run and never could get it done. I wrote and re-wrote the jobs using Vcarve software and Carbide Create, and both gave the same results, the router bit stayed 1/8 inch above the wood.
I went thru both programs and double checked that I had x/y zero at top of lower left, and I set z zero so that bit was barely touching the wood. Nothing worked.
Today i went to my shop and decided I would run one of the jobs again, and guess what, it worked perfect, and everying has worked all day long.
I know I was setting everything up yesterday exactly as I always do, and exactly as I did today, so I have no idea what the problem was.