Although this thread turned into a discussion on milling attachments used by placing the cutter in the spindle of the lathe, the original post just asked about whether milling attachments were good or bad. A VersaMil IS a milling attachment for a lathe. The Smallest VersaMil milling head, uses #2 Morse taper tooling, and is suitable for use in a small lathe. HOWEVER, you can't do high quality work with low quality machines. If the lathe is not very robust, you won't have luck milling with it- with a VersaMil OR a milling attachment.
The real problem with milling in a lathe, is the saddle is not designed to have loads applied to it that can LIFT the saddle up. Because of the cutting forces in a lathe, the saddle is ALWAYS being forced down into the bed of the machine. Milling doesn't always force the saddle down, so you get chatter and lousy finishes. SOME lathes like Monarch 10EE's actually have bearings on the bottom of the saddle that keep the saddle from lifting. These lathes are MUCH more suitable for use with a milling attachment. So unfortunately, in the hobby homeowner variety of lathes, milling can be a frustrating task.
I realize that buying a new Versamil is out of the question for most hobby machinists. HOWEVER, there is a plethora of USED VersaMils available, that are well within the price range of a serious home shop machinist. It's just another option available to get a job done in a minimum amount of space. I regularly get reports of the small VersaMil sets being available for well less than $1000.00. The Army used literally thousands of these sets over the last fifty years, and the majority of their surplus sets, are the smaller #31 number two morse taper size. Considering all the attachments, this is some real bang for the buck for a small shop.