Kai was godawful back in the 80 - early 90s, yes, but somewhere around Land of the Free, he actually learnt to sing. His uncontrollable voice and falset stuff was at worst unforgivable. That's, in Helloween EP and in Valhalla.

WoJ somehow was pretty good, must be because of the mix and/or the editation - there's that huge delay present on the whole album, and I think it hides Kai's major flaws. That ridiculous falset stuff, though, is annoying. I think Kiske falsets too but he's the master in it.
But Kai began using his strenghts - bogeyness and death metalish schrieks and stuff - when he took the main vocalist place in Gamma Ray. He also made his voice more controlled and he could actually interpret cleanly even. He's so different from others and - though honestly yes a pretty bad singer still - he does have his moments, and that unique style and color of his voice makes him one of the - if not best - most fitting vocalists in any music. His voice fits Gamma Ray's music like no other voice no other band's music dammit!
By the way, ever since I read and heard him singing Regrin the Dwarf in Avantasia, I haven't gotten the image of his voice being a dwarf's voice out of my head.

He really sounds like an old, small man.
Despite all this, he surely can interpret. The compilation Blast from the Past must show his multi-diversity in the best form. That album alone kinda proves it to me that he is one of the best in business. Or the most fitting, anyway.