My experience with both programs is minimal so far, but I'll jump in anyway. I considered becoming a certified Kindermusik educator a couple of years ago but never quite did it. Over the years I've been more intrigued with Music Together's philosophy and approach, especially after listening to the ravings of my friend whose children have done MT. (She's a member here, hopefully she'll see this thread and post.)
My 3.5 year-old ds just had his first Music Together class this past Saturday, and we're hooked. I was attracted to the mixed age, family atmosphere. I love that my dh and I can both go to the class with ds. I believe that by the time a child is 3-4 in Kindermusik, the classes are w/o parents. I feel a little weird that my ds is the oldest child in the class by a long shot, but I also love it that he will be interacting with little babies and toddlers.
Several months before signing up for MT, I got the parents' handbook and read it. I think the very biggest draw for me is that the program is based on thorough research about both music aptitude and early childhood education. I didn't want a program that stressed performance. I loved that MT focuses on development of pitch and rhythm as that is that I believe is most important for a young child. I was excited to see that the program is partly based on research of a man that I did a paper on in graduate school.
I have been excited to see ds's response to MT after only one class. The very next day he sat down with his songbook at the piano and played and sang one of the songs from class. Of course he wasn't playing the actual music, and he didn't have any concept of the tune, but he had the rhythm down pat. I was mostly excited to see that he was so excited about the music. He sang the song over and over, and it was adorable that I got our the camcorder and video-taped him. We have listened to the CD quite a bit since Saturday, and he already remembers bits and pieces of the songs. Of course he is far older than the OP's child, and I have been working with him musically (informally) for a long time. But he is excited about the class and about the music. I can see already that this class is exactly what he needs and is perfect for him. I just love to see him getting into it so much. I had gotten him some little kids' instruments (bell, drum, shakers, triangle, etc.) for Christmas a year ago, and he barely touches them. But since that MT class two days ago, he has pulled out his instruments several times to play along with the CD.
My ds especially loves rhythm, and there is a lot of that in MT, so it's another big draw for him. He loves doing the rhythm patterns in class and on the CD.
I don't know if it like this in all places, but here all the Music Together teachers seem to be professionally educated musicians, dancers, and theatre people who have additionally become certified to teach Music Together. The Kinder Musik program is open to basically anyone. They don't do their training in person but it's all done through distance-learning and the prospective teachers are assessed via videotape. MT I believe does training workshops where the students work with live instructors who can observe and give feedback. To me this is important. Since I'm a musician, it's important to me that the teachers have substantial training and a good background in this area. I don't think that would automatically negate Kindermusik, but I'd have to do a lot more asking about the teacher to find out his/her actual credentials.