Cadence/HR/Time would probably give a better indication than distance and speed on the turbo...

By the 'flywheel', is this not a turbo and is a spin bike? I would suggest strongly of not installing a speed sensor on their flywheels. Some of those reach silly high RPMs, and the magnet is designed to mount a spoke, rather than a (I assume flat?) flywheel. If it is a spin bike, their flywheels aren't usually 700c, some are bigger, most are smaller (like a magnetic turbo trainer resistance unit) and spin very, very quickly to give the desired flywheel effect.
Only just read the 'diameter of the flywheel', so I'm assuming it is a spin bike... They aren't made for measuring speeds/distances (unless it's electronic, in which case these read-outs are on displays anyway), they're made to be measured via effort, rather than speed.

If it is a turbo trainer, then the speeds you measure will probably not seem unrealistic, and are comparable against speeds on the same turbo trainer. They aren't accurate by any means though and aren't comparable to outdoor speeds/distances.

I sincerely apologise if I've mis-interpreted your post... But it looks to me as if you're trying to measure the speed of a spin bikes flywheel... Also, apologies on the long post, it's been re-written a couple of times.