How to Align the 7x10 Tailstock

There is a socket-head screw underneath the tailstock, and a common-screwdriver
setscrew on the side of the tailstock, under the handwheel, down near the lathe
bed (it may be painted over).

To adjust the tailstock, chuck a piece of (preferably aluminum) rod as long as
you can get that will fit in the lathe. Use a center drill and center drill the
rod. Place the live center in the tailstock and place the rod on the live center
with the other end in the 3-jaw chuck. Take a light turning cut (1 or 2 thou,
ideally under power-feed) the entire length of the rod (You *can* take cuts for
about 1/2" at each end of the rod instead of the whole length...). *Don't change
the cross-slide or compound adjustments once you begin*. You need to make sure
that the cutter actually cuts into the rod at each end. If your tailstock is off
(towards you) enough, the cutter may not touch at the headstock end. If it
doesn't touch, take more light cuts until it does. Using a micrometer or
calipers, measure the diameter of each end of the rod. If the tailstock end of
the rod is smaller in diameter, the tailstock is set too close to you. If it's
larger, the tailstock is set too far away. Make a note of the *difference* in
measurements.

Ideally, you need a dial indicator to measure the amount you're going to move
the tailstock. If you don't have one, it's going to be trial-and-error...
 
Remove the tailstock from the lathe. Loosen the screw on the bottom of the
tailstock and place the tailstock back on the lathe. DON'T tighten the large nut
that locks the tailstock to the lathe ways. If you're using a dial indicator,
place it so you can measure the amount of movement. Loosen the setscrew under
the handwheel. Move the tailstock *HALF* of the difference in measurement
between the ends of the turned rod (i.e. - if the difference in measurement is
10 thou, move the tailstock 5 thou in the direction it needs to go). If you
don't have a dial indicator, you're going to have to "wing-it"... Once you have
adjusted the tailstock, tighten the setscrew under the handwheel. Remove the
tailstock from the lathe and tighten the screw on the bottom of the tailstock.
Replace the tailstock on the lathe, re-chuck your test rod, take another turning
cut, and re-measure each end of the rod. If it's still off, redo the adjustment.
Once you have it where you want it (that would be with each end of the rod the
same diameter), you might want to scribe a witness mark so you can return the
tailstock to this point if you have to move it in the future (like for turning a
taper). Keep in mind that you'll need to re-check this from time to time...
I did this procedure on my 7x10, and I can't measure the difference in diameter
with calipers that will measure to half a thou.

There is no vertical adjustment for the tailstock or headstock. If either one is
off, the only way to fix it is to lap the bottom of the culprit. Hopefully,
things are correct as it comes from the factory.