:) So, I am ready for my second try at this. I bought KOTOR 2 off Gog last year but had to get a refund due to 'graphics card incompatibility (integrated intel). Having a new graphics card, I have once more bought it off GOG and would like to install this. But for the newbie the instructions leave me a bit confused. Do I just drag it into the folder GOG installed it in?
Also is there anything I need to look out for, tweaks I need to make? I'm on Win 10 and have a Nividia card.

I gather STEAM might've been all set up and ready to go, but GOG was so helpful last time I wanted to get it here (without the DRM stuff).

I download it from here and the downloaded file was an executable that I ran and had it install the mod for me. I have NIVIDIA but I have windows 8 though.

This is the most "official" download link, Deadly Stream is the home of KotOR modifications.
There is a detailed description and installation guide on that site, which should be easy enough to follow. Generally you just have to execute the installer, like the GOG game installer, and point it to the game's main installation folder.

As far as tweaks are concerned, the game (well, the GOG version) doesn't have native widescreen support, so you have to patch it accordingly, if you want. That's a bit more difficult, but also doable.

There are tons and tons of great tutorials around for all of that, you just have to spend a few minutes searching. As I wrote, Deadly Stream is a good pool of information. [url=http://pcgamingwiki.com/wiki/Star_Wars:_Knights_of_the_Old_Republic_II_%E2%80%93_The_Sith_Lords]This[/url] site is also very helpful.