Temperature sensor slope explanation
Kelvins are exactly the same size as degrees Celsius. The Kelvin temperature scale is merely offset by 273.15.

A difference of 1K is exactly the same as a difference of 1°C. 

So if you take the 8-bit number (which would have a range of -128 to +127 if it's 2's complement) as 0.5K per LSB you'd have a range from -41C to +86.5C.

Kelvins are often used in place of °C when differences (such as temperature rise) are involved, probably to keep separate the temperature and the difference-in-temperature units. In most electronics contexts (not all!) it's obvious you're not talking about temperatures near absolute zero.