"The law requires Youtube to remove all of these videos from the internet and they cannot be restored unless a counter infringement report is made and KBS chooses to either accept that it was a mistake or to go through legal processes (suing me/other users)."

That is actually not what it says.  YouTube must accept your counter-notice and restore your video within 10-14 business days of receipt.  (However actual response times are closer to a month)  The claimant of the video must then go to the federal district court in the area that you reside, unless you live outside of the US, then the jurisdiction falls to San Francisco.  They must file papers in court within 10 business days to issue a court order preventing the restoration of your video.   This cost is a few hundred dollars.  

As you can imagine the chances of them doing this is none, and the use of their content may fall under fair use.  So if you believe that the use of their content was used for commentary criticism or news reporting then file a counter-notice.  If you have any more questions feel free to contact me on YouTube.