Instance Selection On MK2 Keyboards
I have now had official confirmation from Native Instruments that there is a bug in the current build of Komplete Kontrol, which negates instance selection from the 4-way Encoder, this only affects MK2 keyboards that have no official DAW host integration.
A fix will be worked on and hopefully implemented
in the next public release.
In the meantime however, it is still possible to switch instrument focus between multiple instances of KK by first pressing the instance button, and then rotating Knob 8 to select the instrument and finally pressing the top row F8 button to make your selection, the only small caveat is that there is no spoken confirmation of this final action.