Dan's suggestion is really good.
For your LED to blink, determine logically when you want that to occur.
One way is to change the state of an LED at each revolution, kind of like a switch. At the start, the LED is OFF. When the distance traveled is greater than the circumference, the LED comes ON, and your distance counter is reset to zero. When the distance traveled is again greater than the circum., change the LED again.
Another way is that when the wheel rotates one revolution, turn the LED ON for a set time, like 0.5 seconds. However, at speeds greater than 120RPM, the LED will always be ON.
What you are really doing is counting pulses from the sensor, and the time between them.
If I might make a couple of suggestions for your code, don't hide the STOP button. Also, try to always keep your wiring to flow in a Left-to-Right direction. That will certainly help with understanding what everything does, and will make troubleshooting a great deal easier.
B-)