KDSS was specifically designed for both OFF-ROAD and on-road use giving the suspension 4 inches more travel than non-KDSS equipped ones.
Really don't want to defend or slam KDSS, but I can't stand to see confusing information.
4" more travel.... No way. It will however articulate better than a stock suspension with standard sway bars on at crawl speeds. Swaybars fight to keep wheels on the same axle at an equal vertical distance from the frame. They are a torsion spring, so in the end... they impact the spring rate on each corner of the suspension but only when there is a delta in distance to the frame across the axle. They basically transfer the spring rate on the unweighted wheel to the weighted wheel and vice versa.
So for pure vertical travel they should have no impact on wheel travel... in articulated travel it will transfer force and attempt to equalize wheel travel across the axle. However, they twist and are a torsion spring themselves, so thickness, material, and the actual suspension spring rates all play together.
BTW, KDSS turns off the normal swaybar behavior by allowing the mount between the frame and the sway-bar to float (below 12mph).
(warning speculation on my part ahead...) Since this float means fluid is moving.... the system is only designed handle this behavior at low speeds without creating too much heat and cavitation.
If KDSS was more of a mechanical disconnect... I would really see no downside at all, but it's implementation on the 5th gen is less than perfect (as most things are). It's still very good for most use cases, just not ideal for all types of offroading. This is why you will never see the system on or anything like it on hard core purpose built offroad rigs. What you will see on those is adjustable sway-bars or pure mechanical disconnects.