Your safety limits are typically physically mounted on the structure and some of the newer systems are also double redundant. As for where you are with the drum, a proximity counter or encoder mounted to either the crown sheave or idler sheave are quite accurate, these locations are not that good for the absolute safety limits as cable growth and or miscounts can effect the position. As an indicator they work fine. Eight of my cokers have encoders mounted on the winch drums. There is some error with this method as the payout rate differs with the number of wraps on the winch drum.