Its a functional tool and it will do what it was made to do in the description but the developer couldn't be bothered to make any actual tutorial on how to use it with an incredibly barebones UI. Typical arrogant programmer sch'uttas. No normal human being/ end user uses the command line for operating modding tools.
Here's a quick tutorial on how to use this to extract models.
1. Download and unzip
2. Run toolkit.exe
3. Click file and navigate to your install of Kotor 1 or 2. Click select folder
4. Now a ton of different drop down menus will pop up.
5. Click on data and go down to models.bif
6. Right click (there is nothing in the UI hinting at this) to bring up the extract option and select where you want to extract the models to.
7. Load up the extracted models in blender using kotortools via the import/export .mdl feature.