I suspect that the firing pin lockup may be malfunctioning. There is a feature in nearly every GBB which locks the firing pin forward until the slide recoils about 1/3, even though the hammer is recocked in the first 5-10mm of travel. This leaves the nozzle body still charged with pressure until the piston clears the nozzle and vents the nozzle.
KSC uses a floating valve in the nozzle body which pops forward when breech pressure drops.
With no firing pin lockup, a breeched pellet maintains a high pressure in the breech until it leaves the barrel. The floating valve pops forward closing the breech passage and diverting gas to the recoil internals. If your firing pin lockup isn't working, there isn't much gas pressure left when the hammer is recocked and is pulled off the firing pin.
With no pellet breeched, the floating valve should pop forward immediately and put your gun into recoil mode which might fully cycle the slide.
http://tech.airsoftcanada.com/KSC/mk23_install_1.gif
I'm guessing that #64 is the firing pin and #69 and #73 are somehow related to the lockup feature. I haven't taken apart a KSC USP before so I can only infer from the dwg. Look for a moving part in the top of the frame which gets pushed down by a surface on the underside of the slide about 1/3 to 1/2 of the way back. It's probably related to the firing pin lockup feature.
You can diagnose a firing pin lockup problem my dryfiring your frame with the slide removed. Ease the hammer down with your thumb instead of letting it slam forward. Some GBBs can damage themselves if you dryfire with no slide mounted (Glocks). Look down the magwell for the firing pin which should stay pushed out even while recocking the hammer. Push down on a movable bit at the top of the slide to see if it unlocks the firing pin and allows it to snap back.