Second question I have is how are monochrome cursor images handled with KMS. Yes we need to support CLE266 which is used in a lot
That depends on your libkms for the device. You can allocate a one bit deep object if you want. Reading libkms source is probably what you need if you've not already done os.
No special libkms for our hardware. Currently the via driver implements dumb buffers so I can work with the generic libkms library. Once tile support is implemented then a special buffer manager will need to be implemented.