My personal opinion is to shy away from the CNC portion and buy the better mill. While CNC is indeed a valuable learning experience, a manual mill is just as capable and you get to learn how to run a mill as well.
CNC conversion takes away some of that learning, replacing it with a "Multi-Purpose Magic Replicator" instead - make it in software and let the MPMR pop it out.
The small mill you mentioned is moderately capable, but that's the best that can be said about it. Look at the reviews at Grizzly.com for more info. Replacing the nylon gear with the belt system, and the torsion spring for Z, are both good ideas - there are a few conversions around.
The next size up (or two) will be a far better machine. None of these is turn-key, you'll need/want to take the machine apart, adjust and polish and lubricate everything properly, to produce good work. That will also teach you what is important and what isn't, plus you'll really know the machine.
Tooling can cost as much as the machine, so research that as you make your decisions. A quite beefy vertical mill without DRO or CNC can be had for $2.5k, and later converted to CNC and/or DRO.
See this thread, especially starting at Post #27.