We use US Digital shaft encoders, with the ball bearing option. The bushing option is cheaper, but is less robust. These things are pretty bulletproof so long as you don't smash things into them or give them unreasonable side load.
We use these on our drive:
http://usdigital.com/products/encode...otary/shaft/S4
And used these on our shooter due to the lower CPR:
http://usdigital.com/products/encode...otary/shaft/S5
In retrospect, the S4 would have been fine for the shooter.