Fold preflop.
To place in freerolls you want to be ALLIN preflop every time your cards have a slight edge, regardless of blind size. KQ does not have any edge against 7 random hands, and you may be dominated. In the case of UTG 7handed you want to wait for AQ/55 and then jam.
With the blinds really high, if you're shortstacked you should also push-n-pray with crap like 75suited if there's been a bunch of limpers in front of you.
Just my $0.02
As for how to beat $20 tourneys, I'll let someone better than me sound off on that.