This isn't a crazy idea at all.
Basically it always comes down to that even if you can match Kabal on the ground, his ability to maintain pressure by jumping back and firing a fireball while avoiding most grounded offense is what makes him completely over the top in most matchups. Liu, however, has quite a few answers to this. His f+12 is fast enough to catch him if he jumped too high and is floating down from the gas blast slower than a lowest height one. If he is doing them at the minimum height, Liu's b+1 and sometimes b+2 will float under the blast and hit him, which takes a decent chunk if cancelled into a special.
So now both characters are forced to play their strong ground games, and I think this is where the stalemate is. At full screen, Kabal will probably be locked down hard by Tiger Shots. A low one, as
MITDJT mentioned, from full or 3/4 screen isn't going to be caught by a nomad dash. A instant air Tiger Shot will recover fast enough that Liu will be able to block a saw from the same distance while Kabal takes the hit. Liu can also react to a saw from more than half screen with a flying kick.
Kabal however will probably press the advantage up close, where his normally great pressure is exacerbated by the fact that Liu's defensive options aren't so good. D1, as mentioned, is 8 frames, parry even slower, leaving d3 as the sole source of counterpoking. Not only that, Kabal's saw isn't actually punishable as far as I know even point blank, so unlike some characters who can get a punish, Liu is stuck.
So the way I see it, Kabal here is in one of the only matches where his approach can actually be hell (
Ermac is the other 5-5 in my book) and where his normally great anti-ground game fails him. However, his intense pressure is still a force to be reckoned with, especially with Liu Kang's subpar defensive options and slow armored moves.
It's a cleanly even match up. As far as creds, I've beaten MortySeinfeld's Kabal 3-0 in tournament recently and done fairly well against DetroitBallin's Kabal as well.
