Type:
./ltib -m prep -p kernel
This will put the kernel source in <ltib directory>/rpm/BUILD/kernel
You don't have to use prep again.
You can then make changes to the driver souce and either use ./ltib -c and go through the menus or
./ltib -m scbuild -p kernel
then
./ltib -m scdeploy -p kernel
If you want to work on the source code for another package such as busybox do the same replacing kernel with busybox.
The documentation isn't very clear about this; when I started with it it took me a while find this.