[Gdeaver]

Magnetic absolute position sensors can have many advantages over mechanical pots or optical code wheel sensors. The mentioned sensor should work very well in the analog version. To point out another option, AVAGO makes a magnetic absolute position sensor that would work also.
The Mouser part number is 630-AEAT-6010-A06. This device has a serial output. Labview does have a SPI VI that probably could be configured to read this device. You can clock the data out up to 1 MHZ. There are also non contact magnetic absolute rotary position sensors. Cherry makes a 180 and 360 degree unit. The price is not to bad. Austria micro makes sensor SOC devices that would be good if a team wanted to make there own. Future and Newark sell these and they have links to the data sheets.