I've ridden the SD a couple of times. I liked it a lot, but it seems very one-dimensional to me with the tiny tank and absolutely no place to strap a bag. I don't want an SUV bike, but I do need a little more versatility in my bikes so I can do a little more than just blast around for an hour. The FI seemed a little touchy, but any bike like this is going to be skitterish. Overall, a fun, fun ride.
I'm not a big fan of KTM reliability and maintenance though. Lots of folks have good luck, but there are some fundamental design issues with the KTM twin that have never been completely solved and routine maintenance is difficult. The there are a few horror stories about stuff passing QA/QC at the factory that just should NEVER happen (like circlips missing in the water pump system).
The tests of the Hypermotard have all complained that there is something a little odd about the seating position and handling - something is slightly "off" and the KTM's are better all-around bikes. But man oh man, the HM is just a lot cooler looking and in this class of bike, a torquey air-cooled twin would be my preference - these are elemental bikes and the HM seems truer to the breed.
Can't go wrong with either (or the BMW HP2 either if you're made of money). But I'd get the Hypermotard.
- Mark