It's kinda obvious that Kim isn't in love with Rachel as much anymore - he likes Kit. Or at least that's how I see it. He does put Kit first all the time, not Rachel, I don't know how Rachel has lasted this long being second best.
Sure he's annoyed/upset about Archie moving away, but I think he's also upset that Kit won't be there either.
I can kind of see the point that Kim made about it not being fair on either child if he has to travel to see both of them. Neither of them would have as much time with him as they would do if Archie was living in Summer Bay. But I do think that was an excuse not the real reason.