I rode a 97 KDX 200 for a couple years, then went to KX 250, then Husky WR125. In April 2001 I bought a new 200 E/XC. I raced all of them (got 3rd in Dist 11 200 B H.S. on the KDX, better on the KTM) and did a lot of trailriding in Ohio, KY, & Baja. I loved the KDX (after FMF pipe & jetting, bars, gold valves, etc.). Also, I rode my friend's '97 KDX 200 for a 1/2 day this past fall (he didn't want to get off my KTM), so I can speak with some confidence as to the differences.
KDX
Soft seat, soft suspension, soft handling. Does NOT like you to slam into whoops/hills/rocks at race speed. Chassis feels best in tight woods when it is not being taxed. Great bottom-end, motor signs off immediately after. Quality of components is poor. Brakes are very decent. Ergos feel good if you're used to them, but come off another bike and you feel like you are sitting "in" the bike as opposed to "on" it. Makes it difficult to get up over the bars, but the bike turns so well, it's not a big deal. Harder to stand up and let the bike move beneath you, though. Overall, a very good bike for beginners/intermediates, doesn't have the motor, suspension, chassis for more demanding riders. I know Fredette can haul ass on one, but riding one back-to-back with the KTM I don't see how I ever went fast on one.
KTM
Better in every way. Properly jetted (different needle is a must) the power is awesome! Instant power right off throttle, smooth build up to great mid & upper. Will lug if you get lazy (if properly jetted). Front suspension great. Send the rear to Enduro Engineering (E.E.) for re-valve ($100). I ride very tight trails here in OH & KY, so I raised the forks in clamps. Steering won't carve quite as well as KDX or a CR (close), but it will not slow you down. Brakes are very good, not great (no one has brakes like Honda). A solid rear disk will give you more progressive feel in the rear, and your pads will last longer (the disc is a must in mud, stock will eat new pads in one long mud race). Reverse-bleed the brakes if they feel mushy. I run a Scotts steering damper & like it, but it's not essential as KTMs are stable. Great handling. Great quality on this bike. I've had zero problems.
Let's sum up: magic motor, super light, comes with lights, fantastic quality, great suspension. I like my bike more and more every time I ride it. My friends call it the cheater bike. This bike WILL make you faster. I enjoy riding more since I got it.
KTM Tips: Get soft seat foam. Combined with the shock revalve, bike is MUCH more supple on rocks/roots. Raise forks in triple clamps for better stearing. Get E.E. clutch cylender guard, chain guide, soft seat foam. Get eRider bracket to protect swingarm where shock mounts (mudflap wears it). Get Michelin tires. Get longer throttle cable if using Scotts damper. ENJOY!