Except that you’re assuming that 1 must necessarily correspond to that minimum distance. Keeping that situation, we can just say that 1 corresponds to two inches and then realize 1/2 as that number.
Classical geometry (a la Euclid) allows for constructing a lot of numbers. We get natural numbers pretty cheaply, negative integers through adding in a concept of directionality (zero is a bit of an imaginative leap which is why it was absent from Western mathematics for so long). Constructing arbitrary ratios is possible through similar triangles and square roots through right triangles, but some basic algebraic numbers like cube roots cannot be constructed with a ruler and straight edge (which raises the question of whether, in a quantized universe, whether irrational cube roots actually exist). Of course there’s no guarantee that the quantization is going to be uniform and we also have the ɣ factor of special relativity (1/sqrt(1-v²/c²)) which gives us a non-Euclidean space to complicate things, but it’s not clear that if you can find a value for 1 that allows you to get a measurement for every irrational number.
One could make the argument that the only numbers that actually “exist” are the natural numbers, but the question ultimately is can you model any real number in the physical universe. Modeling ½ is simply a question of picking a unit to be 1 and finding its midpoint (or for that matter, declaring two apples to be “1” and thus a single apple would be “½”, although it’s a bit of a challenge to use apples to model (2-√3)/5