Speed regulator for sewing machine

[Kenwood]

Hope to get some help or advice.
I am new to programing and trying to learn. This is also my first post.
I am trying to design a speed regulator for a sewing machine used for quilting. The sewing machine is on an X, Y table and I need to keep a constant number of stitches regardless whether sewing machine moves X or Y or diagonally. My encoders on the tacks give me 55 pulses per inch of travel and I feed these signals into the inputs of the Pic. I take the pulse width of each encoder convert the value back to hertz. I took these values of X and Y and do a hypotenuse calculation on them and take the value and feed a PWM output. The Pic works on the bench using signal generators etc but in practice it has problems. There is far too much time delay during acceleration and deceleration. I.e. it takes .65 second to sense a 0 pulse in. This circuit uses a 4 MHz crystal. I tried 20 mHz and it improved but causes other problem. Thanks

' PULSIN Command
' 16F88
' Serial Pulse Width Meter
        Include "modedefs.bas"          ' Include serial modes
        
        DEFINE OSC 4
        
        
       
SO      VAR PORTB.5                       'Define serial out pin
FI      VAR PORTB.4                       'Define frequency input pin X1
FI2     VAR PORTB.2                       'DEFINE FREQUENCY INPUT PIN Y1
W0      var WORD
W1      VAR WORD
W2      VAR word
W3      VAR WORD
W4      VAR WORD
TRISB = %00010100
          #CONFIG __config _CONFIG1, _HS_OSC & _WDT_ON & _LVP_OFF & _CP_OFF & _CCPMX_RB3 & _CCP1_RB3
          #ENDCONFIG

 displayloop:
         Pulsin FI,1,W0               ' Measure pulse (in 10 uSec)
         Pulsin FI2,1,W1              ' Measure pulse (in 10 uSec)
 
         W2 = 50000 / W0
         W3 = 50000 / W1
         W4 = (W2 HYP W3)               'HYPOTENUSE CALCULATION
        
        If W4 = 0 Then disp             ' If non-zero, display
        Serout SO,N2400,[#W4]
disp:   Serout SO,N2400,[" Hertz",13,10]        ' Display trailer
 HPWM 1,W4,1500                          
        Goto DISPLAYLOOP                 ' Forever