Looking good so far!! Have fun with the project, and use the forum as there is so much help out there.
Can't wait to see another Cafe K8!
If you are going to go with rearset, there are a limited selection of bolt on kits for the K8, so maybe look to a custom job. I did and it was cheaper than buying a bolt on kit, but just think it through before you finish painting or powdercoating the frame.
Best of luck!!