Actually kapm-idled should be using around 98% when you system is idle and this should drop when your apps start using cpu cycles.
I think you must have gotten the figures mixed up (unless your version of top is showing something weird).
kapm-idled is the idle time daemon in kernel 2.4.x. It runs when the processor is not doing anything and calls the idle/call instructions to cool the processor/slow the processor/save battery. (XP and possibly W2K also have a similiar process running)
So the less work your system is doing the higher the value of kapm-idle should be. The 2.6 kernels have hidden this away so that it doesn't show up in top or other cpu% programs and alarm people.
Don't worry about kapm-idled - it's not eating your cpu cylces, its helping cool the Z when its resting. You can't get rid of it (except by changing kernels, which I don't think is an option yet for the C3k)
Stu