Sweet man, I'd say since you have the lathe you've got it made.
The heat sinks I use for projects like this are just a simple flat top sink that sits in the head, but also extends into the neck.
Here are some pics if you want to get an idea.
Here is a good lens (the 52.1mm for mag). I prefer the boro vs UCL because with multi emitter setups you can end up with little rings or marks on the UCL coating.
Finally the
driver. This driver will give 3 mode at 2.8 each, but you have to use it in a very special way.
http://www.candlepowerforums.com/vb/showthread.php?201392-Poorman-Mutli-Lux-setup-method
The one in the first picture is how it would be for yours.
If you decide to go that way there are a few other things you need to know but this gives you an idea.
Since you have a lathe/mill at your disposal there is a fairly cheap solution for the reflectors as well.
You could take some of these and cut them to size. If you use 14mm stars they would sit under the reflector base ( you'd have to trim a little off the bottom) and just cut out fore the wires. You also have to trim a bit off the tops because they are too long and too big around, but it works if you just take it slow so you dont chip the finish.
If you do order those illumination supply also sells the driver I mentioned.
If you dont want to do it like that there are good reflectors you can buy, but you would then have to come up with a way to mount them.
MCR 20 Joker would work.
http://theledguy.chainreactionweb.com/index.php?cPath=48_50_64
These would take a big chunk out of your budget though at over 3x the price.