LEDs can be used as indicators or for illumination. In TV and movie props, LEDs are almost exclusively used as indicators, rather than for illumination. This is because back at the time when it was cool to use LEDs, their brightness was not enough for illumination. Only in the recent years have LEDs become widely available for illumination.
An advantage of LED over incandescent is their power requirement. LEDs require much less power and are therefore more convenient for portable, battery powered applications, such as hand help props. It is interesting to note that it did not take long for LEDs to be replaced by another technology in consumer, portable electronics, and for the same reasons which saw LEDs enter this field. This other technology is liquid crystal displays (LCD), the dull, grey displays which made funny patterns when you pressed on them. Requiring even less power than LEDs to operate, they quickly took over LEDs in digital watches and calculators.
Michael Knight COMLINK watch, which he used to communicate and control KITT remotely, was using an LCD screen. That COMLINK watch was in fact an LCD AM radio on which a custom faceplate was added.
For many years, the only way to add color and some light to LCDs was to add LEDs behind the LCD. Still that did not have the appeal of LEDs.
Today, about 30 years later, Apple is said to be working on a new watch with a bright, appealing color display.