I believe you can mod the 87 forks and make them nearly as good as the 88's.
I know because my ones (87's) have been fixed and work real nice!
Still if you are slow like me, it doesn't really matter.
The 88s were a proper cartridge fork, rather than the 87's Travel Control Valve fork - the cartridge fork is fundamentally better.
I recently read that a cartridge fork added US$400 to the price of a new MX bike in the mid-late 1980s. Honda used them on the 86 CR250 and they were unquestionably the best forks out there. The other manufacturers faffed around in 1987, trying stuff like TCV to match the performance of the cartridge forks without the cost, but by 1988 they realised that they had to go to proper cartridge forks to be competitive. The superior forks were a big reason why the 87 Hondas dominated shoot-outs across the globe.
There's no doubt that the 87 KX forks can be hugely improved, though... For a start, the stock spring rates would suit an eight year old kid, better than they suit a typical VMX racer.
In 2012, its easier/cheaper to buy a pair of 88 forks and bolt them straight on - although their springs are still too soft for most of us.
The US-model 46mm RWU forks are even better, but you need the matching triples and front brake caliper to suit (and maybe brake rotor and wheel to suit).
On the rear, the 87 KXs had a fairly small, primitive valve piston. The valve piston from a late model (1995+) KDX shock will go in and is a better design but will require revalving to get it working better than the stock 87 KX item.
I'm pretty sure that a whole 88 KX shock will go into an 87 KX which gets you a bigger and better valve piston. The stock spring rates are radiacally different 87 vs 88, so I assume you'd need to revalve and respring the 88 shock in an 87 bike.
