Your problem is all about tool's radius compensation.
Firstly, radius compensation is really complicated problem, and it's really hard to solve it.
Secondly, there's a point for EMC2 to stop executing the program if it faces with strange place. Because there's non zero probability that it could follow to break the part or even the whole machine.
And such situation comes up if EMC2 can not reach a line or an arc with given compensation radius.
As they say at the EMC2 mailing list
if you meet such error the tool's radius compensation should be made by CAM program.
So, all you need to do is: select your gear, then pres Ctrl+J to make it dynamic offset. Open XML editor by pressing Ctrl+Shift+X, and change inkscape:radius value to your tool's radius in px. 1 inch = 90 px so for 0.125inch it would be 11.250px. Then convert the path back to path from dynamic offset by pressing Ctrl+Shift+C. And export it to Gcode with out using tool's radius compensation.
Use the Console, Luke.