I think, the ki drain would out weigh the PL gain. Cos it should not be as good as a real transformation, which I think, normally or on average will double your PL (2x). So you should be getting about half your PL again increase from it (1.5x).
The constant ki drain (faster than flying + flying = quite a drain) would have you always recharging ki. PLUS you lose HP. You would only get about one or two melee swoops out of your entire ki pool (faster drain than flying + swoop). And if you used a couple of teleports, probably only one swoop. I think the usage of it would be very limited, maybe to a desperate final melee hit to try to kill someone before they get you.
But in such a scenario, you should have a decent amount of HP to perform kaioken, so really you have less need to use it because you already have the upper hand on your opponent. Catch the drift?
I imagine implementing kaioken more as a glamoury kind of thing. Something to catch your eye and go "wow! wtf was that?!" with a melee combo incorporated into it through the use of limit break moves. The new melee coding should let them incorporate some fancy looking stuff into melee i think.
PS: Also, raising your PL to "finish someone off" isn't a smart thing to do IMO. I'm pretty sure the game is designed so if you have a lower PL you gain more PL for your hits. So if you raise your PL to hit someone, you are actually getting less PL reward for hitting them... I think. I guess only PcJoe or harsens would know for sure.