No experience with the KW3 setup. Adaptive drive is incredible. I've driven both std and adaptive drive X5s back to back and the difference is night and day.
The nice thing about adaptive drive is the sway bars are hydraulically controlled. So, the springs don't need to be terribly stiff to control body roll.
Damping is changed when controlling sport or non sport modes. Not significant, but noticeable.
One thing to consider, is the aftermarket suspension may cause issues with warranty related suspension problems.