Just a thought - have you checked the needle valve clip setting position? I had similar sounding problems with my 500 K0 and a lot of its issues (much spluttering above about 5.5k revs) were caused by an over rich mixture, primarily caused by incorrect needle jet height. Mine were dropped by one notch and, with original (very expensive, David Silver Honda nos O rings in the carbs), the overall affect was miraculous; you could mention CB500 and Swiss watch in the same sentence without blushing!