Beginner, Stepper control with Uno or Mega 2560

My milling machine has a common axis drive for the 3 axis driven by 1 motor, then applies a clutch to drive a specific axis. I want to use Arduino to drive the common drive with a stepper motor having control of which axis is moving at a specific RPM for feed rate and # of counts for positioning.
Can the Uno or the Mega 2560 achieve the following.
Drive the stepper using both RPM for feed rate and number of counts to move axis to a specific point.
Switch the XYZ axis clutches on/off.
Have a display for input information, axis selected, RPM, # of counts
Matrix keypad for inputing which axis to move, RPM and # of counts,

Can the Uno or the Mega 2560 achieve the following.

Basically yes.

which is the better choice to use, Uno or Mega 2560

It depends on how many outputs / inputs you need on your system.
I would tend to always use a Uno and add a port expander or two if I want more, like in my CNC project:-
http://www.thebox.myzen.co.uk/Hardware/CNC_Conversion.html

Very impressed with the Mac based controller you created, how difficult was the process.

Mac based controller you created,

Well it was not a Mac based controller. It was an Arduino based controller being fed Gcode information from a Mac. The stuff that ran on the Mac is in Processing and so can run on any platform.

how difficult was the process.

Well I had to buy a lathe to machine the couplers so that was the hardest bit. Otherwise it just took time.

Mind you I consider hard things that don't work second or third times, so if you want hard look at these two projects:-
http://www.thebox.myzen.co.uk/Hardware/RFID_Sequencer.html

Harp player