If you get a full system (headers back) it should remove the stock cat. Not to sure if thats how the kawi is set up, but my friend has an r6 and thats how it was for him. Full system kinda pricy tho. And i've heard the $ you spend isnt worth the power you get out of it. But let me know if you do it, and how it works out for ya. Just curious, if its worth it i might have to get me some micron serpent headers. Did some readin on those and they have AWESOME hp gains.
but in the end you can tell that my idle is unstable, meaning that my bike is running lean, which in the long run will melt my exhaust valves. as a result, you will need a PCIII. i have been running without the cat and lean for approximately four months now and still runs fine. my bike is currently in the dealer getting my valve cover gasket replaced. (hopefully with the new 08 design). I also assume that my exhaust valves are still in good condition, or else they would have told me something about it....either way i don't want to know.
Your bike (I believe) comes with an integrated power valve. This valve works in tune with the factory exhaust system to provide a smooth tractable torque curve throughout the bike's RPM range. It also helps the bike comply with the all mighty new EURO3 emmisions regulations which are getting tougher and tougher to pass.
Removing the cat without a proper tune, will ruin your power delivery and make the bike's power even more top-end biased. Yes, less torque than it already has (yikes!).
What you're not seeing with those claims on that dyno is that the bike's tractability and torque curve have been shot to shit. Sure the top-end power has increased, but at the price of precious mid-range. Mid-range that makes the bike usable on the street.
If you really want to change the exhaust on an 07 get a full system