So after a good deal of head scratching and a fantastic suggestion from Sokol1 I think I know what has to be done...
Due to the need for the Warthogs stick to remain attached in order to be registered by windows I will not be stripping out the warthog stick instead I will be tricking windows into thinking the KG13 is a USB Ps3 Controller or keyboard
To do this I need a USB board and the Teensy look like it will do the job
http://www.pjrc.com/teensy/
The dimensions are 1.2" by 0.7"
So, the Teensy will fit in the box that previously housed the 8 pin din connector

.
Now I just need to understand what each wire controls and rewire them to the teensy.. at least I hope its that easy.
The warthog stick itself will be connected to the base but stowed in a box I am going to make.
The last thing I need is a connector from Mentalnwood's warthog extension to the KG13 which I can hopefully get manufactured locally.
Like I said before... now I need to figure out how to wire it correctly, the next and probably last hurdle. I hope its just a case of soldering the wire to the board but I am not certain.