PIC12F509 Not Blinking
In Section 4.5 of the datasheet for this device, the OPTION register includes bit 5, or T0CS - the Timer0 Clock Source Select bit, which by default is set (1).

In this state, the comment in the datasheet notes:

1 = Transition on T0CKI pin (overrides TRIS on the T0CKI pin)

As GP2 is shared with T0CKI, you need to clear T0CS before clearing the TRIS register bits to enable GP2 as an output.

int main()
{
    OPTION = 0x00;
    TRISGPIO = 0x00;

    while(1)
    {
        LED = 1;
        __delay_ms(1000);
        LED = 0;
        __delay_ms(1000);
    }
}