everyone is getting blown out about runout. Now I've never tried it, but some people will mark the workpiece w/a sharpie then approach it carefully w/a grinding stone (by whatever means), and monitor the progress. It depends on what you're trying to accomplish - bring the surface into greater tolerance or improve the finish (often it goes hand in hand). If you were to run your carriage up and down (back and forth rather) a workpiece with a spinning grinding stone, couldn't you sneak in incrementally, measuring often? Do I sound crazy? This isn't production shop methodology. You can always remark the workpiece, and when the surface of the rod say starts to approach a suitable ground finish, you measure, remark, and sneak in some more if necessary. Repeating as often as necessary.
What about using oily emery paper on a spinning fixture to improve a bore, say to take a spindle? There are definitely ways of polishing or grinding to get the tolerance you need.
Ever heard of lathe filing? How many people on this list have tried that???