i think they 'changed' the name for international appeal. KFC sounds so much cooler than Kentucky Fried Chicken. like you said, who knows Kentucky? i guess it also saves space on billboards and signs when they combine KFC with Taco Bell and Pizza Hut (same company).
oh, get this. the stock symbol for KFC/Taco Bell/Pizza Hut is YUM
Edit: pretty much what "MQS" said