Currently (All of Fabric 6 1.5.0), any Chipped blocks must be manually crafted using the corresponding workbench, which requires the player to be active and limits gathering of such materials to a single thread.

I would like if it was possible to use the Cutting Machine from Modern Industrialization to automatically produce/convert Chipped blocks at the cost of lubricant and the base material.

For example, one of my buildings costs 10,000 Polished Stone to construct. Without this change, I would have to manually place a stack of stone, select the "Polished Stone" option (which requires scrolling several notches), then take out the Polished Stone and repeat 156 more times (with 6 full-inventory movements in-between).

With this change, I should be able to lock the recipe in a Cutting Machine for Stone → Polished Stone, place the required Stone and 10 buckets of lubricant in a barrel, then wait (4M EU in 1h 50m, time divided by machines used).

Likely fixed. Commit 105a7cb (release 1.8.0) adds a KubeJS script to copy over all Chipped block recipes to the vanilla stonecutter, then, as far as I can tell, other code within MI takes all stonecutter recipes and copies them to the MI cutting machine.