I am a singlespeed 29er afficionado myself. I don't have a Karate Monkey (though I do think it's an amazing frame) but a Redline Monocog. So what I am going to tell you is general, but I feel it's useful especially because I am about the same size as you, and because I use the 29er like a commuter just like you do.
First of all, frame size depends a lot on how long your arms and legs are. This is by no means a universal thing. My ex wife had a very short torso but extremely long legs. I am the opposite, I have a relatively long torso and somewhat short arms and legs. This fact has limited my choice of bikes and riding positions. Also, for whatever reason, my M-sized (18") Monocog suits me perfectly and there are days I wish it was bigger! I used to ride a 53cm city (comfort) bike until I sold it, and that size was just great for me, although I am relatively small.
One of my mountain (26") bikes is a 17" Kona Kilauea. The other is a 19" KHS Nomad. BOTH (!!!) suit me perfectly! They have very different geometry, and different style handlebars. So you are very right to ask about the handlebars, as they will impact your riding position and the comfortability of your ride dramatically. (I can tell you that neither the swept back nor the Albatross look like the kind of bars I would use for my commute. That's all I know about them, sorry )
So what does the above tell you? My experience is that you really have to try the bike for yourself. Find a shop that sells the frame or a bike built around it, and try it for size.
Lemond Maillot Jaune, Specialized Stumpjumper, Kona Jake the Snake, Single-Speed Rigid Rocky Mtn Equipe, Soon-to-be fixed Bianchi Brava
I have the same variety. Until I started riding FS, I was riding a 17" Rocky Mountain hardtail, and now I'm on a 16" stumpjumper. My road bikes have ranged from 49 (sloping) up to 53. Its sounding like, I'd be better erring on slighty too big vs too small. But I'll wait to see if any KM owners pipe in.