Having both KW and ZW transformers, I would give the nod to the ZW, it does give you a lot more flexibility. Though people say that the ZW controls 4 channels, it was really designed to control 2 trains, the other two variable outputs (the sleeves) were designed for accessory output. They can control a train, but they don't have the whistle and direction control I believe (I never used the outer sleeves to try controlling a train). I also personally think the ZW is more durable, with the KW the whistle controller is kind of dodgy (the shaft on it is weak, plus the plastic lever can strip easily) and the train control handles are not necessarily that great from what I recall.
One of the things to keep in mind is that with the older transformers, the rated power is not what you get at the track, I believe in the day they measured it on the input side, and that does not represent what is actually available at the track (doing it the way they did was marketing, saying a transformer had 275 watts of power or 190 sounds better than prob 225 or 140, which is what they might give out at the track (I forget the actual ratio of stated to actual)).
If you do decide to use a postwar transformer like the kW or zw, I agree with others, make sure to have a good circuit breaker on the output and put tvs across the track output as well to prevent surges if you are running any modern engines with sound systems and such. One of the advantages of a modern transformer like the ZW-L or the Z4000 from MTH is they have such protection built in.
