I don’t like calling Gief’s full-range SPD “kara”, since it bears very little semblance to SF3’s kara throws.
Ja-Ei: The idea of whiffing the FP is to get the tip of Zangief’s fist to snuff most anti-air. It’s extremely hard to beat, not only because of priority, but because of timing. JChen once mentioned that very, very few moves will beat this (such as Cody’s slide).
Yes, the variable ranges of Gief’s SPD also applies to the PSX version. And since you’ve mentioned PSX, try this in training mode: get the dummy to crouch then do Zangief’s jumping FP in such a way that only the very tip of Zangief’s fist will hit your opponent. If you whiff the attack instaed of hitting, you’ll land approximately at Zangief’s max SPD range (which, as SaBre mentioned, is outside crouching FK/RK of the shotos, and well outside jab range). Against a human opponent, the jumping FP can be done either early or late. Doing it early will increase the likelihood of not being hit out of it (but, as I’ve said, it’s very unlikely in any case) but nullifies almost any chance of it hitting. Doing the move early also has advantages against people who are already familiar with the trick. Some players will try to jump at Zangief, and doing the FP early will either trade hits or make them airblock. Doing the move too late also has problems – you’ll see what I mean when you try to hit a crouching opponent.
Against a human opponent, you’ll see further effects of whiff jumping FP. Some players go into a mental blackout when they see it. “Wow, look at that jackass Zangief whiffing an attack from so far away.” There are a lot of players who wont react to it – by simply crouching, or trying to sweep, or do an ineffective anti air.
As for doing the full-range SPD, you don’t have to cancel from a standing JP. Just pull off the SPD before Gief goes into jumping animation. Whiff cancelling just ensures that you stick to the ground while spinning the stick. The methods you mentioned – ticks, wake-up, while recovering from the glove also work (although in the case of ticks range is pretty minimal anyway). However, it will be in your best interest to be able to SPD perfectly while walking.
Another method of landing the SPD is to walk back into SPD. Again, this works wonders against shotos, who love poking with crouching FK -> fireball. SPD 'em as they come into range.