Yeah, they were the one's I was originally looking at. But look at the one in the michael decker link I posted. It just looks like a 'proper' piece of engineering...
I reckon making one might be the way forward. I don't have a clue how they work, but I've got a few ideas that might be worth a shot. In particular I reckon with the use of modern sensors it might be possible to build an electronic version that is much shallower...
I came across the link you quoted a month or two ago and as someone (JS??) pointed out that supplier specialises in supplying research labs and similar academic bodies so inflate the price according to what they can get away with, not what's 'reasonable'. That said, they are not generally cheap, I just go very lucky on fleaBay.
The height from the bottom of the quil to teh tip of the probe is a minimum of about 3", depending on whcih probe you have selected. The mechanism is very simple. There is a plate about 3" long and 1" wide which is pivoted at the mid point of each end. The probe causes it to rock one way or the other depending on whether it is inside a hole or outside a bar or on a not-normal swashplate. There is disc as I recall, a bit bigger in diameter than the width of the plate resting on the top of it, so that irrespective of which side of the plate rises or the orientation of the rocking plate as you rotate the spinde, the disc always rises. This presses the DTI probe which is mounted in the non-rotating body of the tool.
There are some additional details including a friction lock for gross adjustment so that it can cope with diameters from zero up to about 12" and some internal adjustments, but essentially that's it.
As others have commented, most of the time I just touch one side then the other with something, (often the cutter if I'm going to machine the outer surfaces later anyway) and split the difference. As long as the witness mark is the same width on both sides, it doesn't even matter how deep it is. I haven't got DRO's, but I don't find it a major issue - don't miss what you've never had. Though no doubt if I did get them I'd be a convert.
Richard