Given a machined cursor blank, clamp it into position:

You don’t want to clamp the cursor directly to the Sherline tooling plate, because the diamond drag bit would pass over two or three of those 10-32 screw holes which would, by the conservation of perversity, leave visible defects. In hindsight, I should have put a recess for an aluminum plate in there.
After a single pass at Z=-4.0 mm, add two strips of tape to protect the adjoining surface and scribble it with red lacquer crayon:

Peel the tape off:

Then wipe off the residue using a soft cloth wetted with denatured alcohol:

That looks much like the previous efforts. I’d like a more uniform trench, but I don’t know how to get there from here.
In any event, the hairline looks pretty good against laser-printed scales:

The new cursor is the lower one lying atop a laser-printed Pickett-style Circuit Computer:

Looks good enough to eat, as the saying goes …
Just thinking out loud, I wonder if heating or cooling the material would affect the smoothness of the cut for the hairline.
It’d surely affect the overall glossy surface finish! When I tried heat-forming some thin polypropylene sheet, it was never the same again.
Now that you mention heat, though, perhaps embossing a line with a heated blade might work.
A razor would surely make a too-smooth V notch that wouldn’t hold pigment, but a flat-edged sheet of very thin shimstock might produce a square-ish channel with maybe a ridge along each side. Either would look better than the ragged scratches I’m so proud of.
Thanks for the suggestion!