Originally posted by Nico
So, that means that KOTOR is wrong? 
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Yes. It isn't using canon source. I don't know the game itself, but as far as I know, you can use a Sith lightsaber there(= Saberstaff), just to make the game more exciting and make the game more sellable. Nothing made by LucasArts is canon, except for the two Encyclopedies they released(Behind the Magic, Insider's Guide). Just thnik of Rebel Assault 1 and X-wing(1992). In both games the Death Star was destroyed by NOT Luke. They both had different pre-story which led to the Battle of Yavin. Think of Rebel Assault II and Balance of Power: They both had one-one Super Star Destroyers. I hope you all know that before the Battle of Endor, mrely one Super Star Destroyer was at the service of the Empire. Then think of the stories of the other LucasArts games as well. You will slowly realize they completely contradict each other(Chandrilla at JKA, and at Rogue Squadron is a good example here) None of them are canon, LucasArts tend to do major changes in the universe just to make their games look the best they would like it.
The saddest is that some of them were 'made' canon by LucasArts, like Jedi Knight I by mentioning it in BTM. Those are only advertisements.
In my eyes, nothing by LucasArts is canon except for some areas of Behind the Magic and Insider's giude. To be honest, I don't have Insider's guide, so I cannot say how many LucasArts trashes it contains.