Could the localhost <snip> be causing the problem?
To add a KML file(.kml or .kmz) to a map, the KML must be available via a publicly accessible URL. Locally hosted or KML files inside a firewall are not supported.
http://utility.arcgis.com/sharing/kml?url=http://dl.dropbox.com/u/2654618/kml/Wyoming.kml&model=simple&folders=&outSR={"wkid":4326}&callback=dojo.io.script.jsonp_dojoIoScript2._jsonpCallback
...is there a JSON or XML format I could supply to the Javascript API directly?
[/HR]Are there any products/extensions put out by ESRI that would allow us to host this ourselves? Our network can never be publicly accessible. Another 2D API handles this adequately but we'd prefer to be ESRI across the board. Plus, the net link capability would be very useful.
So is ArcGIS Online from the ArcGIS Portal the only way to do this? All I need is the kml utility which is located at http://utility.arcgis.com/sharing/kml
Those are your two options: put your kml on a public server and use the service on arcgis.com or host your own arcgis portal. We don't provide the KML service as something you can host on your intranet.