You can play with the stylus and bit size to reduce, and then cut them in sharp with a knife using My manual setup, but the problem with using a smaller endmill is they break easy, and the good ones are expensive when they break like that. I like to setup for a endmill that can take alittle more, and just knife the corners when I want them sharp, but sometimes I just fit them to the exsisting pocket the way it is. If i did them all sharp, and was to sell the cue, then the price would have to reflect the extra work, and cost.
It is also possible to hog the pocket out with larger bit, stylus change, and smaller endmill in a way to get it closer, and save on bit breakage some, but It's all about mixing the stylus and bit (endmill) sizes correctly to do what you want, so takes some experiementing, and several size endmills and stylus to get a system down. Inlaying cues manually can be tricky also, so this is one that can test you alittle, and is better learned hands on IMO. Alot can go wrong, so practicing on scrap is also a good idea here as well.
Some guys have cnc machines cutting them out pretty close with their setups these days. I would think their tool paths, and bit changes may have something to do with that, but someone already using one of those could probably give better info on how they go about it.
Greg