1) When measuring speed you dont need the absolute position rather you need change in position from previous position incremental encoder is the way.
2) Building absolute encoder is expensive for position control generally devices have incremental encoder with limit switches
(check any deskjet HP printer, it has an incremental encoder with DC motor for position control, when
the printer starts it it starts from one end where there will be a limit switch and it calculates it relative
position from that known position by counting its steps forward or backward)