Interesting idea!

All three 3.c4, 3.c3, 3.g3 would be a good move, but after 3.d4? cxd4 4.Nxd4 Nf6 5.Nc3 e5! the idea well proved.

I like the variation, but I have mixed results wit it...

Recently I have started playing it tentatively in turn-based games. I haven't yet had an opportunity to try it in an OTB game. This variation is said to be given to real test after 3.c3, but that actually occurred only in one game out of four. 3.d4 happened twice and one opponent tried 3.c4.

people who play KIA would be pleased to see this line i would imagine. in some variations black would rather push ...a5 (in one go) at some stage. not greatly familiar with the o kelly to tell the truth so anyone know how useful it is against KIA? like, pros and cons or does it simply transpose? i imagine it just transposes if white wants.

I use it and find it a change of pace. I must purchase O'Kelly's book about it. 

It certainly is playable : hasn't Ivanchuk used it against Polgar and got a draw as black ?

Besides, it has some good surprise value, and may be especially annoying against people playing open sicilians or Bb5 lines...

3. c3 would be a good move.