I rode a KDX200 once in FL, it was fun, keep it pinned and shift! The 525 Beta or KTM for that matter is a totally different bike, it almost doesn't matter what gear your in, grab a handful and it's going to go. It's not the MX style rip you arms off power, it's nice and easy but it gets up and goes when needed. It's very easy to ride, single track or wide open desert.
As far as tires go I've been running Michelin Bajas, they're DOT and Hold up very well and work great offroad. I'm not sure about the safety aspect of having more hp, it can't hurt though. I went with the 525 vs 450 for Baja, I figured that the bigger engine would be taxed less on the long high speed sections down there.