Surely the magnet woul be going faster on the rollers than on the wheel spokes as it i travelling the full distance wheras on the wheel it is travellng Rm/Rw (at least with the positioning I have for the magnet.)
Absolutely; but it's generally easier to get the magnet much closer to the spindle of rollers than it is to the axle of a wheel, with the result the closure angle is increased by more than the ratio of the circumferences.
For example, a wheel with a magnet between 2 spokes of a wheel may close the sensor for 15 degrees (or worse cas even less). The period at say 40mph is then 15/360 * 1/Revs/sec = 15/360 * (27/12*pi)/(40 * 5280/3600) ~= 5ms.
At the same 40mph a magnet on 8" training rollers next to the spindle can close the reed for 90 degrees or more, so 90/360 * (8/12*pi)/(40 * 5280/3600) ~=8ms. And since you control that hardware, it makes sense to mount the magnet as close as possible to the spindle of the rollers (a real gotcha here is, as TimO points out in #16 above, with a bar magnet you can easily get double counts or worse, especially at low speed, as each pole of the magnet goes past the reed - if it happens, a bit of re-positioning usually solves it).
Anyway, as you control the physical setup in this case you can compute the minimum period and design your hardware/software around that. On the other hand, for the general purpose case the closure can be much less than these examples; say you put the magnet on the edge of a flywheel on a wind or mag trainer, it can easily be doing over 100mph (40mph * roller diameter/flywheel diameter = 40*8/3 = 106.7mph!).
As an aside, worth noting that (from personal experience) if a magnet flies off a roller doing over 100mph, it makes for quite a missile.