When developing an external example for KDS (Mongoose web server), i found it pretty hard to incorporate pieces of the SDK that i need, namely drivers and LWIP stack.
the example project ended up being more complicated than necessary, i had to instruct the user to put SDK in a specific location so that i can then refer to a specific directory inside. my example also had to import just the right parts of LWIP and exclude others - all in all, not a very straightforward way of doing it.
i am not working on an LPC4088 port and found that to be much better: in the LPCOpen package drivers are themselves separate Eclipse projects, and other projects can refer to them using eclipse path variables, like so: ${workspace_loc:/lpc_chip_40xx/inc}
lpc_chip_40xx here is the driver project's name, so it doesn't matter where the user put SDK, i can simply instruct them to import this particular project and that's it. very handy.
it's not all roses with LPC SDK - they duplicate entire LWIP source 3 times, which is a bummer, but that's another matter.
so, my suggestion for KSDK is to create projects for chip drivers, FRDM-K64F board drivers and 3rd party software (e.g. lwip). this will make using SDK in projects easier.