How to drive external LEDs using Digilent Genesys (Virtex-5) FPGA? How to use pressure or IR sensor input?
Wow, using a Virtex-5 for this is massive overkill - on the scale of using a nuke to open a peanut.

I'm not sure what voltage the I/O on the Genesys board runs at; as long as it's 3.3V (and it probably is) you should be able to connect a LED of any colour via a series resistor (higher or lower value for lower or higher brightness, start with 1kohm) to ground using one of the PMOD ports.  Turn the LED on by putting a '1' on the output, or off with any other value.  Take a look at Digilent's LED PMOD for a schematic, and also their BTN PMOD.

External sensors are going to be, well, buttons - unless you're trying to detect the presence of vehicles, which could get a bit more complicated.  If you are, then something along the lines of a small magnet in each vehicle and a hall-effect switch underneath the model road would do nicely.  The outputs of hall-effect switches behave like a switch or button, so they're convenient to work with; they typically provide an open-collector output that pulls to ground in the presence of a (strong enough) magnetic field.