some things i noticed (through my haze and bewilderment) is like with most midi devices ESPECIALLY the Alternate Mode ones, MK-KS, DK-KS, Diti, etc
1. the second that connection is made, your KAT device is already sending CC #'s, PC #'s, etc, etc...
to anything in that signal path and some things could change or react weirdly
2. (somewhat related) WHENEVER I power on anything using the Kurzweil Sound chip, i suggest scrolling upon one kit or two and then back down again before performing, just to make sure things are 'straight' (did you ever turn it on and the screen shows one thing and the sounds coming out are completely different like a 'default' piano patch...??)
3. YES, YAY DUDE! ...you figured it out and yeah it sounds like the USB out from the KETRON is causing some sorta MIDI Loop / redundancy kinda thing...
i think you should start from scratch again.
1.the Ketron to your PC/MAC with only the USB Connection (and only use the MalletKat Midi out to Ketron Midi In only)
OR...what I would probably prefer, because I am old and like making things more difficult
2. MIDI out of MalletKat/Vibekat to the MIDI IN of the KETRON, then MIDi OUT from the KETRON to your midi IN of your interface, AND the 2 audio outs from the KETRON to two separate Audio ins on your interface.
(yes now you'll have to open up at least two or three tracks in Sonar or Ableton or whatever...record midi to one MIDI track, and one audio track records from KETRON right audio out and another audio track for the KETRON left audio out)
with midi recorded, and you're happy with the performance, then disconnect the MalletKat or Vibekat, and do midi out from Sonar to midi in of the Ketron (or any external or internal sound source) and voila....whatever trips your trigger
let's see how you are coming along when you can....i.e....audio or video that you might share with the forum...