ddickey,
I wouldn't waste time of money on a test bar in my opinion. All it's going to do is confuse you more. It will only tell you how much wear and tear there is in your machine's alignment. If you try to adjust your headstock to get it align with a worn bed, you will create more issues that you don't want. If you have a 4-jaw chuck, take a short piece of polished drill rod about 1" OD x 10-12" long. Indicate it in at the chuck and out at the end. Get it as close as you can to within .001". That will work as good as that $122 test bar will give you if not better. I know people say that not to use drill rod because it is not straight enough. I haven't yet bought a piece 1" diameter that wasn't straight. The problem with a store bought test bar, is that it registers with the taper on the ID of the spindle. I haven't yet found one that will run dead true end to end. Always out a tenth or two. The reason for the use of the drill rod is, it gives you an "quick" idea of what your alignment is within. Will also indicate how much wear there is in your 16 plus year old lathe has. The inspection record that Grizzy shows is only good as the machine leaves the factory, provided it passed all of the tests. Most of those tests are performed with special trueing fixtures that are mounted to the lathe spindle that allows the test bar to run dead true end to end. It's not necessarily a test bar stuck in the spindle or between centers.
I stick to my earlier statement of excessive wear in the saddle causing the indicator movement as shown in the earlier post. Yes, by all means, level the bed to remove any twist that may exists. This needs to be first item on the list to do in trouble shooting alignment issues. The two collar test in my opinion only checks alignment of the tailstock to the headstock. But you got to remember, when you have lathe that has wear and tear from use, these test are not going to allow you to improve accuracy to the machine. All it's going to do is indicate that there is wear in the machine. And from that, you improvise how to correct the wear or live with the wear.
Ken