Loot and XP are always a major issue. You don't want players getting too much or too little. On one hand, they'll get bored. On the other, they'll get frustrated and leave.
I think KT has a pretty good balance. I agree with those who dislike having to run the same dungeon over and over in order to gain enough loot/XP. With KT, you aren't supposed to be able to run a dungeon in a single trip unless you are handing down items or otherwise getting a leg up from other players. If you play it as intended, you'll have to loot and level up a bit before getting strong enough for the boss. That's one of the reasons why I try to create at least two separate routes for each dungeon (except for unholy...the exception).
BTW, each dungeon is supposed to have easy and hard routes to take. If you get upset that you can't ever find a lot of loot on bugbears, for example, you might want to try the giant route. The loot rate is usually higher for the hard route.