Steps to get the game working:
1.Download and extract the archive, you will be left with the KHBBS folder and seplugins folder
2.Copy the KHBBS folder to the root of your memory stick
3.Copy the usersyslib.prx from the seplugins folder to your SEPLUGINS folder ( ms0:/SEPLUGINS/)
4.Open the game.txt in your SEPLUGINS folder(ms0:/SEPLUGINS/game.txt) add and save this:
ms0:/seplugins/usersyslib.prx 1
ms0:/KHBBS/KHBBS_patch.prx 1
5.Check to see if plugins are activated from recovery menu.
EDIT: For USA version.. download:
nar3usa5xx.exe
Rename your .iso as pspking-nsunh3.ISO ,then run the patching program. Then follow above. I didnt test it but I was told it works.