You can latch a coupling to connect stepper output shaft and potentiometer just exactly like PR24. But you need to design the joint so that such mechanism can be mounted.
LED display? I think you're talking about LCD here.. Since you're using potentiometer, you can read the analog value of the potentiometer using the uC, then display the value in the LCD. To include LCD to PR7, just refer to other DIY projects which are using LCD. See how they're connected to the PIC, learn the program and integrate the LCD function from those DIY projects to PR7.
Matlab? No experience using it...sorry!
