So far I add the KMZ as a zip archive to the filesystem, and then load the actual model (Specified in models/KMZFilename.dae).
The bugs are as follows:
1) Major bug: The transparency doesnt work. I had to add _BREAK_ to the string literals in lines 1263 and 1264 to get the model to even display.
2) The model is flipped on the X and Y axis's (Y being upright) as seen in the following screenshot.

3) The model has no textures (They are placed in the kmz archive by google sketchup in the images folder, and then referenced in the dae in the correct folder).
It should look like this:

Code here:
CColladaFileLoader.cpp - http://pb.luahelp.net/1324
Game.cpp - http://pb.luahelp.net/1323
So at the moment i'm currently stuck with no textures. If you want the model / kmz / sketchup file feel free to say.