You might not need the
DEFINE OSC 4
but it is a good idea to put it in. That is the line that tell PBP how fast the chip is running. I assume you are using the 4MHz internal.

The state of the mosfet/led depends on how you have the hardware setup. Just change the LOW/HIGH around to do what you want.

Like I said before. This will need a good denouncing routine to work correctly. Now that you say the button could be pressed at 20HZ even more so. What is going to press a button that fast?

Here are a couple of threads that might help you.
http://www.picbasic.co.uk/forum/showthread.php?t=13516
http://www.picbasic.co.uk/forum/showthread.php?t=2180

Read them all the way through.