After pretty much exclusively playing Kung Lao since MK1’s launch, I think I can confidently say that he’s just okay.
As far as Kameo pairings go, your best bets are Kung Lao and Goro.
Kung Lao gives you mix potential and better neutral presence with the low hat, the spin gives you a launcher but I will note that you can’t do the low hat setups within the same combo as the spin (they need to hit the ground first and “reset” for the low hat to be delayed again). I think the teleport sucks though.
Goro gives you an armored launcher for your wakeup into 330ish damage or it being possibly plus when blocked, opens up combo routes that you wouldn’t normally have, a side switching launcher, hard to avoid unblockable stomp setups, and cheeky crouching throw combos.
I’ve seen some Scorpion use as well because it does a very similar job to Goro for the combo routes, but the extra damage you might be getting (haven’t thoroughly tested it) just isn’t worth losing the utility of the others.
Frost can be a dark horse pick for her snowball combo setups, but they’re heavily dependent on opponent conditioning and making them to scared to try and counter. She also gives you a stun/combo extender, even from fullscreen.
Looking at Kung Lao himself, let’s start with the negatives.
Either he can’t really play neutral at all or his neutral game is just really bad (like, you probably feel awkward or uncomfortable when you’re not right in the opponent’s face). The hat tosses are okay, with one giving you a knockdown on hit and the other hitting mid. But the problem with them is that the cooldown time between hat tosses is ridiculous. Really, the best options you have in the neutral are trying to selectively dive kick all over the place or estimate a decent range to throw out B3, 4. His button range is average, at best. He doesn’t really feel like he has viable anti-air buttons. He’s got some plus frames (+3) off of B4 and 2, 1, but they don’t really feel like usable plus frames in that you seem almost limited to D1, D3, D4, or a throw if you feel like taking a risk. His jump punches are awful because they have no vertical presence. He has some decent mids, but no hit confirmable mid, which is really just a screw you in netherrealm games, but especially for a character that doesn’t really have any mix either. And lastly, thematically/aesthetically the hat is barely a part of his character identity in his moveset.
As far as positives go for Kung Lao.
He has one of the better armor breaking options in the game in 3, with 2, 1 also being viable (anything above 15 start up frames is basically a guaranteed break. anything 15 start up frames or lower requires stricter timing. and you’re just not armor breaking Ashrah, Havik, Johnny Cage, and General Shao. Although, you can avoid the wakeup attacks of the latter 3). He’s got solid damage and corner carry. His combos aren’t that challenging to do. Spin can counter most wakeup options in the corner and it can even be used for flash parry offense, provided you’ve got reads like that. There might be some cheeky cancel pressure here, but it really just depends on the opponent. 2, 1, 2, DB4 (enhanced) can force the opponent into a guessing scenario of holding your jump punch on the way down for continued offensive pressure, they can try to up block which you can counter with an empty drop to the ground for a throw, they can try to anti-air or air-to-air which you can counter with a dive kick (and if they try to anti-air with D2, they’re in so much recovery that you can dash back in for a full B2, 4 punish). If you try this in the corner or your opponent is using one of the few characters in the game that have unique uppercuts that can clip your dive kick behind their head, you can cover your descending jump punch with Goro which will lead to offensive pressure or a full combo if they slack on blocking. And if the DB4 (enhanced) hits, just go for your usual combo of like 300ish damage.
So to summarize, you can definitely play Kung Lao, but you’re going to feel like you’re trying pretty dang hard to make things work most of the time. He needed more dirt than what he got. Feel free to let me know if I’ve missed or misunderstood anything.