This episode is an example of what makes this show so good; it leaves us wondering and intrigued. Other reviews and the episode recap cover the details; instead let me speculate, since that is the reason I'm saying this is a superior episode.
While it is still possible Kyle is from outer space, the chances are very slim. The two possibilities I'm exploring are he's a modified clone of Adam or Adam after twenty years of experiments. I'm leaning towards him being a clone modified for his super human abilities. Could the writers be setting us up to meet the 40 year old Adam in a future episode? Who knows but talk about a fun future!
And don't forget the background TV News show heard in the first episode. The police (somewhere) find a naked girl who can't remember and about the same time Kyle appeared in the same condition. Was that filler or a clue to the Kyle's future?
As I said in my show review of Kyle, this show has many of the traits of Fox's cancelled John Doe and beyond. I'm glad ABC renewed the show!