In addition to configure diff bikes, set the “wheelsize” to auto: the Edge500 will compute wheel size at the beginning of every ride based on GPS signal.
I have no way to check this right now, but I thought that instant speed was coming from my speed/cadence sensor (I also use a Garmin sensor in addition to the PT) but overall distance was from GPS. I may be wrong here though.I would need to run a few tests to confirm this.