Wes- Fear not!! You're system is light years ahead of my first system. Most of us have been where you are. Haven't looked lately, but Kenwood used to be pretty good sounding gear for the dollar- much better than most of the other mass marketed brands. Reminiscing for a second, I used to have a Kenwood 40 wpc integrated amp which blew the socks off a friend's 120 wpc Pioneer recvr.
Given your system and assuming that you plan to upgrade other components along the way, I'd stick with my original suggestion of a used P3, especially if you can find one with the Rega cartridge included. (No fussing with VTA or alignment as it's virtually fixed in the correct place.) For an extra $150 now, it would leave you free to upgrade other components a step or two and not be compelled to upgrade the table to take advantage of those components.
To answer your question about hooking up an outboard phono pre, you are correct- you plug it into "AUX".
A potential sytem upgrade path for your situation would be to then use the Kenwood's pre/pro output to a separate amp, then get an outboard phono amp and a cartridge upgrade. You didn't mention what speakers you had, but, after the amp, you might dive into a pair of main speakers. Then you could sell the Kenwood and pick up a separate pre/pro.
Speaking from experience, making one bigger step with each component is easier and much less expensive than making several 1/2 steps. You'll reach your goal quicker, easier and far less expensively. Plus, as you upgrade other components, you can immediately take advantage of the better quality you have already purchased along the way. The basic lesson is to PLAN and TAKE YOUR TIME! (Heck, up till a couple of weeks ago, my speakers were only less than 10% of the cost of my system and worked fine till I finally upgraded them two years after upgrading everything else!)
Regards
Jim