There were a couple of things going on for this for this. The first thing was that the relative path was not properly updated for the location of the files on the server. I added in a ../ to the path and this worked ok.
Next I looked at the $kfm_workdirectory in this file and set it to ''.
you will still not be able to browse to the php files since they are explicitly restricted for security reasons. You will need to edit the following three files to allow for PHP but be careful with this as it can pose a major security issue:
HTMLEditor\editor\plugins\kfm\configuration.php
look for $kfm_banned_extensions and remove ,'php'
HTMLEditor\fckconfig.js
find FCKConfig.LinkUploadAllowedExtensions and add |php to the end of the list
HTMLEditor\editor\filemanager\connectors\php\config.php
find $Config['AllowedExtensions']['File'] and add in , 'php' at the end of the list
So for this user to be able to select php pages from the root of the site the path needed to be updated in the configuration file so it points at the root of the site, then these other changes needed to be made to allow for php files to be selected.
