how can the allocation be distributed among the kit components

When using kits only the kit has a sale price. If you want to sell items individually but sell them together then you need to use item groups.

If you have Fair Value pricing set up, the components break out on the Revenue Arrangement but not the sales transaction. For example, here is a snippet from an Invoice and the corresponding Elements from the RA. The RA shows the component revenue breakdown and that the kit has $0 revenue.

At the end of the day using kits on a sales transaction doesn't price the components, only the kit. What the RA might have is irrelevant. Item groups is the only other way to load a set of items and have each item with a sale prices.

Yes, that's correct. But you can get the component breakdown from the RA, and that meets our needs. Item Groups don't. Totally depends on your business needs.