What I hope to do here is build the entire system on a single board and hopefully achieve better control of the decoiler and maintain a more constant loop size.

I will try initially to use a triac and proportionally control the rate of the decoiler based on the rate of material being fed into the press.  This will not work on all systems because some decoilers only work in an on/off state, but I think that the code should be the same because as the stock material approaches the sensor the controller will drive the triac to a steady on state until change is made.  

Also, I am going to try to use one ultrasonic sensor as a transmitter and either two or four as the receiver to hopefully more accurately determine the position of the stock material when it is bouncing.  I think what will need to be done here is set the sensor up so that it gets a baseline reading of where the floor is before material is run under it.  Interpretation of the signal will take some trial and error though.  Twisting is not usually a problem, but the material will sway from side to side, and buck.  This returns a reading of the floor or a false reading.  I believe that the sway can be solved by keeping the transmitter on until a reading from an acceptable range is achieved (or an error state is reported), and the bucking could be handled in a similar fashion.  If the height of material is significantly greater than the previous reading then the transmitter could be left on and the receivers could follow the material until it reaches it's trough and sees another rise, acting on the lowest reading that is not the floor.