The common method that I use for setting my Z Height is to use a 0.020" feeler gauge. I normally use the fast jog function to get close to the feeler gauge and then I switch to jogging by 0.010" until I can no longer slide the feeler gauge under the toolbit. If I want to be at the bottom of the backlash, then I'll change to 0.001" and jog the toolbit up until the feeler gauge can fit under the toolbit. If I want to be at the top of the backlash, then I'll jog up twice and down once while still at the 0.010" setting and then switch to the 0.001" setting and continue to jog down until the the feller gauge just starts to "catch".

NOTE: While jogging, I pull back on feeler gauge so that the toolbit won't run into it accidentally. Bigger...