@ilaudio 

Correct, from my experience, fact that the primary KS230 Version 2 switch is flashing red confirms the line and neutral is connected.  However, the two traveller wires are not correctly connected somewhere, either at the primary or the dummy KS230 kit.  Had the two traveller wires been connected correctly (order does not matter), it would flash ornage / green and the dummy switch would also light up.

From my tests, the KS230 v2 will be in a ready state with minimum line, neutral, and both travellers connected from primary to dummy.  The load only and naturally needs to be connected to trigger the light fixture - which you could do at the end if you just want to test / confirm your travellers.

FYI .. there are alternatives to twist cap nuts that don't damage your wires and better suited for both testing and in wall use.  I've name dropped a common brand before but prefer people to do their own research and learn / lookup appropriate safety regulations, etc.