First, your 8520 will never fit an R8 collet, even if you make a brand new spindle, it is just too small.
Second, you might have better luck just using a fly cutter. For large work I use a 2MT end mill holder for a 3/4" end mill, then place a large fly cutter with a 3/4" shank in the end mill holder. Works like a charm for me. A face mill places a large load on the machine. A 2" face mill is about the biggest I would think the 8520 would handle, and that might even get a little dicey.
ON EDIT: I did manage to find a few 2MT shell mill/face mill arbors, some with tang end, and some for a drawbar. The problem with the ones meant for a drawbar is that they all are threaded for a 10 MM drawbar, not a 3/8"-16. I found suppliers in China and England that have them. Buying from England is very expensive, while buying from China is very inexpensive, but I have a hunch that the quality may suffer.
I bought a 2MT 1" stub milling arbor for slitting saws, etc., about a year ago for my 8520. Only place I could find one was England, and it cost me plenty. But, the quality is outstanding.