Kistler's website has quite a bit of documentation on their recovery
system for their two stage to orbit design. They have the first stage
do a second burn *after* seperation, in order to slow the stage down
and point it back towards the launch site a bit. They also modify the
trajectory a bit so that the first stage doesn't get quite as much
downrange velocity.

I gather Kistler's second first stage burn is a consequence of trying
to recover the first stage on land, near the launch pad. From what
I've read, SpaceX appears to be trying to recover the first stage in
the ocean, quite a ways downrange. Do they end up with significantly
more heating during the first stage reentry? I haven't seen any
mention of a thermal protection system for the first stage.

I also haven't seen any mention of the development of a restart
capability for the Merlin engine, which I would imagine would be a
significant part
of modifying it to be an upper stage engine.

The final thing that struck me reviewing the two websites is that
Kistler burned through something like $500M in startup capital, never
launched, and used already-developed engines. Maybe Elon managed to
raise a lot of outside capital, because he only had $100M or so to
spend on SpaceX. Somehow they've managed to develop two different
engines and appear to be at least as far as Kistler was when it went
bankrupt (and maybe farther).
Elon must be a pretty good manager to get so much more for his buck.