Have you completed this project?
I'm not familiar with 16'' DP's terminating in a Jacobs Threaded Mount. A Jacobs is a locking taper, used on their largest chucks; very secure. I believe the threaded section is just one end of a mounting arbor. I've mounted dozens of chucks, never had one fail.
CHUCK MOUNTING. Clean the male plug and female receptacle with acetone and do not touch with fingers at all. 'Wring' the chuck slowly turning it by hand perfectly straight to engage the taper; spindle 'locked' at low speed and a rag stuffed between belt and pulley, NOT under power of course. Put a straight long reamer in the chuck to determine runout by hand. If straight, draw the jaws into the body and use the quill to rap the chuck face into an oak or aluminum block just once and check runout again.
MT CONVERSION. Converting to MT would require disassembly, a lathe to drill and ream MT perfectly concentric, and unseen issues.
Send a photo of the spindle, is there a slot for a drift to release tools from the spindle?
STIFFEN THE QUILL. There is a cap opposite the handle with a spring like a motorcycle kick starter. It has lug as to adjust resistance, pull it out a 1/4'' or so and rotate one way or the other to increase, probably CCW. The adjustment depends on how far you are moving the quill; too tight and it will bind or snap in long travel.
BEARING CHANGE. Changing the bearing depends on how the ID of the housing and OD of the quill. A single taper bearing won't do much on it's own, there are mods with roller+ball combinations. You could upgrade the bearing grade, some milling machines are grade 7.
FINE FEED. Difficult, as that is built into milling machines. You could adapt a dial indicator to better visualize travel. A hydraulic cylinder & needle valve clamped to the quill might work; like the down feed on a horizontal bandsaw. Another way, right angle gearbox and handwheel. Milling machines have them; nubes lose them, unaware what they are for.