Sorry, but mine and my wife's Note have always worked in Kies, from GB all the way to 4.0.4 ICS. All aspects of Kies works as well, from synching to backing up to firmware upgrade.
Something is wrong with your installation and USB drivers perhaps, it needs to be troubleshooted and I wish i could help you more.
Is it Windows 7?
Do you have any security software that stops USB drivers installing correctly?
You using latest Kies?
Does mass storage work (i.e can you browse your internal SD and external SD in Windows Explorer)?
When you plug in your Note does your PC recognise that there is a device there?
Have you tried reinstalling Kies? If not perhaps try this and clean out registry entries for it?
Good luck