Controlled by arduino too although I wonder how much is actually the arduino and not just the computer telling it what to do...
If you look at the build page for the Mini-CNC machine:
http://www.contraptor.org/mini-cnc
Under firmware you will note "Arduino GCode Interpreter". Now, I have yet to find the sketch on the site (maybe there's a google code section somewhere?), it hasn't been that important to me since I have no near-future plans of building the machine. Since it is also using the RepRap stepper motor driver, the code may be based on something from there (IIRC, the RepRap machine uses Arduinos as well; don't quote me on this, tho!).
If it is running a g-code interpreter, that means it would be doing a lot (actually, I think the Arduino being used is a Mega); not much processing needed on the host CPU (unlike other CNC builds). The real beauty of the Contraptor system is the standardized components, based off the gridbeam system (which is a cool system unto itself - its a pity it hasn't become more common in the 30+ years its been around!).
Also, another thing to keep in mind: On another list I am on for the TRS-80 Color Computer, there is a guy on there who is running his own custom built CNC machine using a repackaged CoCo 3 - basically an 8-bit machine (Motorola 6809, though he might be running a 6309), with 512K RAM, and a floppy drive - at 2 MHz. His code is written in BASIC-09 (running under OS-9, a multi-tasking, multi-user, windowing-capable OS for the 8-bit 6809).
Even with a ATMega8 @ 8 MHz it should be possible (RAM needs aside, that is).