If your current KVM uses straight VGA (and therefore your monitor accepts analog input) it shouldn't be a problem. I've had a Samsung TFT770 (18" LCD) working off a Belkin Omnicube (electronic switch but the principal is the same)quite happily with this set up.
The only problem you might have is that the picture on LCD panels can suffer slight deterioration if you're using an analog video signal. It's barely noticeable, and you can normally use the monitor set up to get rid of the problem, but its worth remembering.
The preferred way to send video to a flat panel display is with a digital interface (most likely DVI these days). I haven't seen any KVMs that pass through DVI signals, but then your video card isn't likely to output it anyway.
My advice would be to go for a panel that accepts both analog and digital inputs. I believe Philips have a good priced (800 GBP, so probably about 1000 USD) 17" panel called the 170 which accepts both. That way you're futureproofed.