I have the same KE! As far as I understand, if you have the 50/50 Rewards (HP and HBD), you can't really go below that 1,98 - except for converting HBD into HIVE and then power up, or power up HIVE from delegation-rewards (I think that's how I got to 1,98).
HBD is not counted, as it is of private profit for the holder (as are the interests), I learned that in the last post.
As long as we keep the HP-rewards staked, we won't go above the KE of 2, so we should be fine :-)
I personally want to reach my goal of 100 HBD, and then I'll start converting again. From the converted HBD, half will be staked, half will go into SPL, more or less. That should bring me to more or less KE=1,5 , over time.