Hydraulics can be precise, down to ~ 100µm. However:
hydraulic pistons [...] used in conjunction with a positive displacement pump and using a large hydraulic transmission ratio the issue of precision could be sorted out, and the incompressibility of the fluid would help to keep backlash to a minimum.
This is not how this high precision is achieved in practice. AFAIK (I'm not in the field) high precision hydraulics are pre-packaged units of piston, valves and position sensor and control the piston for position.
