I think what you meant by 'digitize' in your original question, you probably meant 'vectorize'.
So you have a JPG you want to convert to a format that can be used by the machine. You either need to fire up Coreltrace, which I have never used but I understand does a reasonable job, OR you could open the JPG in CDraw and then use the Pen Tool to create vector paths around the logo's components.
I assume you have been asked to make separations for the machine in order for it to use different coloured threads for the different components. Does the original logo have spot colours or is it CMYK? If the latter, are there parts of the logo made of more than one of the process colours? Impossible for a sewing machine to reproduce the final composite colour in this case. Cotton threads don't work like printing inks.
So once you have vectorised your logo, you need to add spot colours to the various components to make it match the origianl as closely as possible, then print separations of the various spots from CDraw to show the machinist where each of the spot colours are used.