It seems that kernel_task is indeed working to occupy the cpu/gpu to prevent overheating. In my case any sustained relatively high cpu load (e.g., watching ten minutes of Flash video) will set off kernel_task. Apparently Apple has confirmed that kernel_task in this situation is kicking in to effectively underclock the cpu--i.e. it's serving the same function as the core shutdown behavior of the first version of the MBA. So says this blog, anyway:
http://gogotechnology.blogspot.com/2009/07/macbook-air-and-kerneltask-apple-spea ks.html
I have gotten desperate (well, really just annoyed) enough to install CoolBook, despite my wariness to mess with such a basic system-level function. Once you pay $10 and register it to enable the undervolting function, kernel_task no longer kicks in--it seems to take over cpu speed/voltage/temperature management.
As I have no experience messing around with undervolting or overclocking my cpu, at first I just set the voltages and clock speed steps to their system defaults. Kernel_task no longer kicked in and I was able to watch high-res video for the first time in a long time, but without kernel_task getting in the way the cpu was running at unprecedented temperatures, over 90 degrees (according to iStat--CoolBook was reporting temperatures 10 degrees cooler for some reason). Next, I set a lower maximum temperature in CoolBook, which drops the cpu to lower clock speeds to keep the temperature down, while still keeping the voltage levels at the Apple system defaults. Amazingly, just doing this kept the temperatures at a normal level and kept my system running smoothly watching the same video that it was choking on before--as I understand it, CoolBook is effectively doing the same thing as kernel_task, but doing a better job. I have since changed the voltage settings to moderately undervolt the cpu (1.025V at 1862Mhz and .9625V at 1596Mhz), while keeping the same low maximum temperature limit (70 degrees in CoolBook, which translates into ~80 degrees in iStat), and the cpu can now run at full speed for a sustained period without having to drop to a lower clock speed.
The CoolBook interface is not intuitive for someone who doesn't know what they're doing, but I figured it out with the documentation included. The instructions tell you how to get the most (i.e., least power consumption, best battery life) out of your undervolting by lowering the voltage settings until your system is unstable and then backing off to the lowest stable setting. I was more cautious and just went a moderate setting, reducing the voltage half as much as others are reporting doing. Seems to have solved my problems, so I'm satisfied.
