I believe LED on that schematic just refers to the onboard LED being connected to that same pin. You can use any digital IO pin for a LED, but I recommend using the PWM pins, as they will allow you to control LED brightness more easily. If you want the LEDs to be separately controllable (i.e. caps can be lit while FN is off or vice versa) you need to use two different pins, one per LED. Don't forget that you'll want to hook resistors up in series with LEDs as well.
You shouldn't need more than 5 mA for any tasks involved in the keyboard you propose, either scanning a matrix or driving a single LED. I don't think it matters which of those pins you use.
It's likely that the typewriter already has a PCB and its own matrix, if it's an electric typewriter. Each row and column will need a digital IO pin, but the logical rows and columns of the matrix likely do not correspond to the physical rows and columns of keys. You can use a multimeter or any device that measures resistance in order to test for continuity, which will allow you to determine which two lines in the matrix correspond to each key -- this will allow you to actually set up the firmware. This isn't a particularly complicated process, but it's time-consuming, and I'm probably doing a poor job of describing it.
The primary advantage of the Teensy 2.0 is that several keyboard firmwares are written for that exact board, and they may not work properly on a Teensy LC. I would expect that you would need to write some code yourself in order to get a Teensy LC working as a keyboard controller.
I think that covers most everything, feel free to ask if you have any further questions.
