Are generator interlock kits permitted in residential applications?
It seems the decision is ultimately in the hands of the Authority Having Jurisdiction (AHJ), as long as "equivalent objectives can be achieved" using the device.


  National Electrical Code 2008
  
  ARTICLE 100 Definitions
  
  Approved. Acceptable to the authority having jurisdiction.
  
  Authority Having Jurisdiction (AHJ). An organization, office, or individual responsible for enforcing the requirements of a code or
  standard, or for approving equipment, materials, an installation, or a
  procedure.
  
  ARTICLE 110 Requirements for Electrical Installations
  
  110.2 Approval. The conductors and equipment required or permitted by this Code shall be acceptable only if approved.
  
  ARTICLE 90 Introduction
  
  90.4 Enforcement. This Code is intended to be suitable for mandatory application by governmental bodies that exercise legal
  jurisdiction over electrical installations, including signaling and
  communications systems, and for use by insurance inspectors. The
  authority having jurisdiction for enforcement of the Code has the
  responsibility for making interpretations of the rules, for deciding
  on the approval of equipment and materials, and for granting the
  special permission contemplated in a number of the rules.
  
  By special permission, the authority having jurisdiction may waive
  specific requirements in this Code or permit alternative methods where
  it is assured that equivalent objectives can be achieved by
  establishing and maintaining effective safety.
  
  This Code may require new products, constructions, or materials that
  may not yet be available at the time the Code is adopted. In such
  event, the authority having jurisdiction may permit the use of the
  products, constructions, or materials that comply with the most recent
  previous edition of this Code adopted by the jurisdiction.


WARNING

While these devices may or may not be approved by the AHJ, they are not the best solution available.  They do not prevent the user from overloading the generator, since the load selection is made by the user dynamically during operation. The better, safer solution, is to install manual or automatic transfer switches. This allows you to pre-select the loads making it a more user friendly solution.