cushen, you're almost right, but you forgot the fact that the wheels are not massless. The poster above me brought up rotational motion, and you have to include the energy of rotational motion in your equation. Therefore, the more accurate form of your equation is this:
mgh = 1/2m(v^2) + (2)(1/2)(i)(w^2) + Q
where i is the moment of inertia for the wheels (about equal to 1/2 times the mass times the radius squared), doubled because there are two wheels. w (should be omega) is the angular speed of the wheel, or v/r. Q is just a constant accounting for any losses due to friction or air resistance.
What the equation says is that the potential energy of the rider at the top of the hill is translated into both translational and rotational energy, the sum of which is not to exceed the original potential energy.
With this added term, you can take a look at the above poster's reasoning, which I haven't really read carefully, and put it all together.