Peter - as the unit is the metre, and kilo means 1000, the (linguistically) correct pronunciation would be KILO-metre, like CENTI-metre, MILLI-metre and so on. Of course, other pronunciations are accepted as correct in different countries, and that is just proof that language is living and developing.
Yes, decimetre is not often used. But decilitre is alive and well in recipes written in French.
Ray