I assumed that stops for rest were implied in the travel time, in the same way that stops for food are.
I dunno that seems really silly to me. For one you don't need to stop moving to eat. Eating and riding, eating and walking, both perfectly plausible and in fact have been done frequently, I think they'd be the rule not the exception if you on the run or chasing someone. And how would stops for rest be implied in the travel time? I mean, this game isn't done in increments of days, it's in increments of maybe 5 minutes or so on the world map. A stop for sleepy time should involve staying still for at least eight hours under normal conditions, probably less under stressful conditions.
Maybe a 'rest' command that restores health faster then normal?
the purpose is not to heal faster, the purpose is: if people do not sleep, THEY DIE. At the moment, sleeping is not necessary for survival in an otherwise somewhat realistic game. I'd probably put sleep in a game before food, since one can eat while doing other things, but sleeping involves you being very vulnerable and stationary for a long period of time, for 1/3 or 1/4 or every 14 hour day.
Ambushed by Dark Riders in the forest? Say good night.
The opposite really. Horses are not known for being as useful when there are lots of trees to run into

. I'd rather be ambushed by them in the forest than run into them in the plains, I gotta say. Would be a poor strategy on their part, if they could even manage it with all those loud horses and clanky full plate armor.
Resting and fatigue are good ideas but im guessing would take a bit of work.
Well, no it wouldn't. There is already a system in place for it. As I said, just make it basically the same system as the current food system, but have it get better when the party sleeps rather than requiring food. A very simple matter to do, especially considering a lot of the ideas people throw around here.
[edit] hmm, thought a little more on the sleeping and eating being taken into account... it wouldn't work for infantry, but I suppose mounted units could take a nap in the saddle. Still doesn't solve the issue of infantry troops/the undead who don't sleep.[/edit]