Kas aren't brilliant for fuel economy, no. That said, you might find the difference isn't as black and white as you might think - where presumably you're having to rev the nuts off the 500 to get it to move, the 8v Ka engines tend to be a bit torquier low down. You can still rev it half to death, but after a while you realise that it doesn't make it noticeably faster - just a bit louder with the same pace. Don't get me wrong, it'll probably do less, just not quite as little as you might think.
Depends on the model and how you drive.
The original Ka with the Kent-based 1.3 Endura-E engine
can be quite economical. I know this after living with a Fiesta with the same engine for six years.
I drive economically. And no, that isn't slang for "slow". It's perfectly possible to drive at a pace that can
easily match the traffic around you (and go for the occasional thrash) whilst using very little fuel. No special techniques required, just good anticipation, lots of conserving momentum, using the engine's torque rather than power and so on - in other words, all the stuff you should have been taught when learning to drive.
Here's my fuel chart for the last few months of Fiesta ownership. All the figures are in U.S. gallons, so in UK mpg that's a maximum of 50.4 and a minimum of 42.9. Ford's combined figure for the car was 40mpg and I was beating that pretty easily by almost 6mpg. You can assume the lowest figure there involved the most town driving, bad weather etc, and I'd say a minimum MPG above 40mpg is pretty good.
The Ka is lighter and more aerodynamic - go figure.
By comparison, I'm averaging around 42mpg from the Panda which is just below the official figures, and 34mpg from the MX5, which was about 5mpg better than the official average.
It's not what you drive, it's how you drive it

So don't rule out petrols unless you tend to be heavy footed.
Incidentally, you could look further afield for VAG diesels - those 1.9s can be found in virtually everything, including the Skoda Fabia and Octavia, VW Golf, Bora, Polo and Passat, the Audi A3 and A4 and the SEAT Ibiza, Leon and Cordoba, so although the Toledo is probably the nicest looking of all of those cars, you'll almost certainly find the same engine in something cheaper! Power varies between models but I've driven the least powerful (90bhp) TDI in a Cordoba and it wasn't
too bad. And in that car it gets ridiculous MPG figures, something like 65mpg
combined.