The design of it that I had in mind was to turn on a small 40x10mm fan to blow on a heatsink when the LED reaches a temperature of around 48C the fans should turn on until it's below that temperature and the fans should turn back off and stay off without any voltage applied.
from what I heard so far I need a MOSFET for it and match a thermistor with it but I can't seem to find the flat kind that I need to put it between the underside of the LED and the backside of the heatsink.
You can just attach or glue the thermistor to the side of the LED at the junction to the heatsink. That should give you a temperature close to the LED temperature. If you put it between the LED and heatsink it will add thermal resistance and cause the LED to run hotter.
One thing I was told if I run two fans on this that the thermistor would burn up? I'm not sure where to start or for sure do I need a heatsink with a fan for it.. it would be a Cree XRE running at 1A.
Edit*
Also I only wanted the fans to turn on when the temps reached around 100C Without the MOSFET some power would always be going to the fan (turning or not) So I don't want to drain my 12v battery over that...
Like one person said if I have a fan running at 0.5A and the thermistor goes down to 10 ohms from 2Kohms it has to dissipate 2.5W
You are using the thermistor in a voltage divider to control the transistor. No motor current flows across the thermistor and so it won't dissipate 2.5W.