Kies really sucks in so many ways. It used to work fine for me but now when I connect the phone the MTP Application on the phone (that's like the phone's counterpart to Kies) just continuously starts/quits/starts/quits every second.
Anyway, all I can suggest is downloading it again from Samsung's site and try again.
You don't really need it though. You can copy files to/from the phone using Mass Storage mode (Home -> Menu -> Settings -> About phones -> USB settings -> Mass storage). It'll then work just like any other USB flash drive.
Firmware updates come over the air (as far as I know). So you don't need it for that either. You can still tether both wirelessly and via USB without Kies.

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