It's been a long time since physics class, but recall that the formulas in play here are based on the
mass of an object (the
m in the formula). The US measure of mass (unit) is the
slug (short for "sluggishness??").
Pounds are a measure of
force... the force due to gravity on the flywheel or car in this case (acceleration due to gravity is
32.2 ft/s^2 in US units).
Additionally,
r is for radius, rather than diameter,
d.
Correct me if I am wrong, but it looks like it should be:
I = kmr^2, where k is the inertial constant (1/2 for a uniform rotating disk).
= 0.5[(40lb)/(32.2ft/s^2)][5.5in/(12in/ft)]^2 = 0.5(1.24slug)(0.45833ft)^2 = 0.13045 slug-ft^2
KE = 0.5(I)(w)^2, where w = angular velocity = (800 rev/m)(2*pi rads/rev)/(60s/m) = 83.77 rad/s
= 0.5(0.13045 slug-ft^2)(83.77rad/s)^2 = 457.78ft-lb = 620 J
For the car:
KE = 0.5mv^2 = 0.5(2800/32.2)(7.33)^2 = 2338 ft-lb = 3169.8 J
It is pretty late, so this could be in error

... I will try to look it over again during the daylight hours
Otherwise, let me know if you find problems.
Thanks