I know nothing about the 89c420 however on a standard 8052 you can measure pulse widths without using interrupts at all. If you invert your signal so that the duty cycle is high and connect it to either of the external interrupt pins the associated timer will only count while the following conditions are true:

TRx=1
INTx=1

provided you have set the appropriate GATEx bit in TMOD.

The measured period is controlled entirely by hardware and is therefore as accurate as can be achieved without having to worry about interrupt latency.