@hondamarlboro: Yep, the iptables rules are changed only when
K3_WIFI="true"

.
And even then, that'll still switch to eth over usb & launch telnetd until
K3_WIFI_SSHD_ONLY="true"
To recap:
K3_WIFI=true + K3_WIFI_SSHD_ONLY=false : Eth over USB, telnetd, sshd, SSH over WiFi.
K3_WIFI=true + K3_WIFI_SSHD_ONLY=true : SSH over WiFi.
K3_WIFI=false + K3_WIFI_SSHD_ONLY=false : Eth over USB, telnetd, sshd (basically, like the K2 hacks)
And that makes
K3_WIFI=false + K3_WIFI_SSHD_ONLY=true pretty useless

. (sshd over serial?

)