First check for any obvious leaks.

Next: If your motor is running rich then oil will be burnt - my understanding is that excess unburnt fuel ends up mixing with the oil between the piston rings and cylinder bore, and this oil then ends up getting burnt. A symptom of this is a smoky exhaust.

Another related cause of oil burning is worn piston rings/or cylinder bore - although I would doubt this is your problem especially with such a low mileage bike (even hard miles), and the fact that your motor also happens to be running eratically implies there's something wrong with the mixture. Check the air filter is nice and clean then strip the carb down and ensure everything is clean and intact, including the jets. Also check the choke mechanism is functioning correctly and not sticking on.

There's a friendly (in my experience) dealer
http://www.dalbymoto.com.au/ with KTM experience - but they're in Queensland.

PS If you're topping the oil up, it might be a good idea to bleed the oil system before riding as you do when changing the oil as per the KTM procedure.

PPS There's another tale of oil loss here http://www.horizonsunlimited.com/ubb...ML/000012.html
due to a cracked piston. But unless oil is being forced out somewhere e.g into the air box via the breather then it's unlikely to be your problem. A worn piston/rings/bore may also result in oil being forced out in a similar way.

[This message has been edited by Ian (edited 26 October 2002).]