I would call an establishment a restaurant if the high majority of the food is served and eaten in the premises. I would expect a high majority of the food to be prepared on site on a 'just on time' basis for consumption.
KFC is definitely a fast food outlet. They can barely put a serve of fries in oil and cook them golden brown, let alone serve them hot without encrusting them with salt. Staff can barely operate a microwave, let alone a grill.
The same goes for it's competitor Red Rooster. Using the word restaurant towards these establishments is contempt. The same way sparkling wine not from the region of Champagne is called 'champagne type,' so should KFC...'restaurant type.'
